5.2.4.6 Group approach & the OECD MTC

A group approach on a domestic level makes it possible to utilize losses in a more comprehensive manner. This diminishes economic double taxation. Cross-border loss compensation could contribute to stimulating cross-border investments. Additionally, often juridical double taxation is eliminated in an intra-group context, as no withholding taxes are levied. Furthermore, the transfer of assets within the group is generally tax free. All of the aforementioned contributes to the neutrality of legal form within a tax system. Therefore, the approach taken at a national level seems to fit within the goals of the OECD MTC. This would not fit within the current framework of the OECD MTC. To truly reflect the economic situation of a group for tax treaty purposes, a comprehensive solution would be required.