Single tax treaty for Europe. How the US is already looking at the issue!

I already reported earlier about some of the cases (D case and Bujura) being discussed by the ECJ, dealing with the eventual application of a most favoured nation clause in Europe. A positive answer by the ECJ can change the landscape of tax treaties in Europe and this will certainly affect the relationship of third countries with Europe. Acknowledging such possible effects, the National Foreign Trade Council (NFTC) of the United States issued on May 26 a report suggesting the U.S. government should begin to develop a negotiating strategy on the assumption that a multilateral income tax treaty with the European Union may become a practical necessity in the not-too-distant future. The report, produced by the NFTC Tax Treaty Project, also urged the U.S. business community to identify the practical and policy issues that would arise if such a treaty were to become a reality.

In "Towards a U.S. Tax Treaty Policy for the Future: Issues and Recommendations, Part Two," the NFTC predicted the coming years may see rapid movement toward the development of an EU model income tax treaty for use in negotiations between individual EU member states and third countries, or even a single EU multilateral income tax treaty. The report is divided in 3 chapters. The first deals with the effects of EU developments, the second deals with Coordination With The OECD and the last analyses the NFTC Contributions To The U.S. Treaty Process. For the report click here

I should add that, the NFTC launched a tax treaty project (2004-2005) in order to examine and make recommendations on a number of significant issues of U.S. tax treaty policy. The project was divided into two parts. The first report issued in November 12, 2004 represents Part One of the project (Chapters 1 through 7). These chapters dealt with: (i) Issues Regarding the Attribution of Profits to a Permanent Establishment; (ii) Practical Issues Regarding Treaty Implementation Arbitration; (iii) Permanent Establishment Issues; (iv) Withholding Rate Provisions; (v) Issues Regarding Pensions and Equity-Based Compensation; (vi) Issues Regarding the U.S. Model Treaty.