The global minimum tax and Swedish interest deduction restrictions

On December 22, 2021, the European Commission presented a proposal to implement the OECD rules on minimum global taxation of profits of multinational groups to prevent profit shifting to countries with low or no taxation. In addition, the European Commission has also proposed two additional tax directives. During 2021 and 2022, a number of guiding judgments have been issued concerning the compatibility of the Swedish group contribution model and the interaction with the interest deduction rules with EU law. In light of the EFTA Court's judgment in the PRA case on June 1, 2022, the need to implement new tax directives, it is reasonable to ask whether there are legal conditions for Sweden to retain the group contribution while the proposed tax directives require the introduction of new interest deduction rules. Through a legal analysis, the project aims to explain and discuss the problems that arise from the interaction between the Swedish group contribution model, interest deduction rules, a fiscally generous interest policy, and the introduction of the global minimum tax within the EU and the new tax directives.