The Ecuadorian Internal Revenue Service has set up a new system to provide advance rulings on a company’s transfer pricing methodology, writes EY in a December 17 report. For discussion, see EY.
The US IRS has posted new versions of forms and instructions to incorporate FATCA reporting requirements, as . . .
Major Chilean tax reform legislation was published in the Official Gazette on September 29, introducing new measures for computing shareholder-level income taxation, amendments to thin capitalization rules, rate increases, and the introduction of general antiavoidance rules, among many other changes, writes PwC in an October 3 report. For analysis of some of the most important tax changes, see PwC.
The US IRS, on Sept. 10, announced that it will amend reg. sec. 1.1298-1T of the passive foreign investment company (PFIC) regulations to provide that, generally, a US person that holds PFIC stock that is marked-to-market under a non-section 1296 mark-to-market regime, such as under section 475(f), will not be subject to the reporting . . .
The Tax Court of Canada, on June 10, ruled in Marzen Artistic Aluminum Ltd. that marketing fees paid to Marzen’s wholly owned subsidiary, Starline International Inc (SII), were not arm’s length.
SII was incorporated in Barbados to act as Marzen’s agent for sales of windows in the U.S.
. . .
The Permanent Subcommittee on Investigations has scheduled a hearing, “Caterpillar’s Offshore Tax Strategy” on Tuesday, April 1, 2014, at 9:30 a.m., in Room 106 of the Dirksen Senate Office Building.
The Subcommittee will continue its examination of the structures and methods employed by multinational corporations to allocate income outside of the United States and how such activities are affected by the Internal Revenue Code and related regulations.
Witnesses will include representatives of Caterpillar Inc. and PricewaterhouseCoopers LLP, as well as tax experts. A witness list will be available Friday, March 28, 2014.
Source: U.S. Senate Permanent Subcommittee on Investigations
US lawmaker, Rep. Mark Pocan (D-WI), introduced two tax bills November 9 designed to take away tax benefits of corporate inversions . . .
Walter Nagel has joined publisher Gannett as its vice president and chief tax officer, leaving . . .
The company said the dispute is over income received from licensing its products to related parties located in foreign markets from 2007–2009. See: Wall Street Journal. More: Forbes, Business Insider, Market Watch.
US House Ways and Means Committee members Charles Boustany, Jr., (R-La.) and Richard Neal (D-Mass.) on July 29 released draft innovation box legislation that would lower the tax rate on income from intellectual property to about 10 percent, arguing that the proposal is needed to keep research . . .
Bermuda is seeking immediate removal the European Commission’s list of non-cooperative jurisdictions as both Latvia and Poland have now confirmed that they have taken Bermuda off their national tax blacklists. Poland and Latvia have contacted the European Commission to confirm Bermuda’s. . .
The US Treasury Department updated its FATCA website reporting that the UAE has signed a Model 1 intergovernmental agreement (IGA) with the United States as of June 17. The text of the agreement is available. The countries, on June 10, 2014, agreed . . .
WTP Advisors announced February 4 that Kash Mansori, an economist and transfer pricing specialist, has joined the firm’s North Carolina office. Mansori previously had his own consulting practice, and has worked for Ernst & Young and Experis Finance. He was also an economics professor at Colby College where he conducted research on transfer pricing, international trade, and international finance.
Five US senators have urged the IRS to take action to stop MNEs from establishing holding partnership structures to avoid paying taxes on recognized gain in an inversion, like the partnership structure used in the Burger King and Tim Hortons merger. . .
The US IRS, in a private letter ruling released December 12, granted a corporation prospective consent to change to the elective method for measurement and timing of employee stock options, restricted shares, and restricted share units pursuant . . .
The Isle of Man has been removed from Republic of Colombia’s blacklist as of October 7 pursuant to Decree 1966/2014, according. . .
The US IRS on October 10 released Chief Counsel Advice 201441015, concluding that no portion of a controlled foreign corporation’s pre-1987 foreign income taxes are eligible to be deemed paid, including additional amounts paid in 2007 as a result of a redetermination of foreign tax. Chief Counsel Advice 201441015
New and updated FATCA frequently asked questions (FAQs) have been posted to the FATCA Website, as follows . . .
Ernst & Young LLP announced July 17 that Richard McAlonan, Jr. has joined the firm as director of national tax transfer pricing controversy in Washington, DC. McAlonan will also act as the Americas director of advance pricing agreements (APAs). McAlonan previously. . .
The Canada Revenue Agency (CRA) has released its Mutual Agreement Procedure (MAP) Program report for the
. . .
The European Court of Justice (ECJ), on April 10, ruled that Polish tax laws that exempt from withholding tax dividends paid to investment funds located in Poland and other EU countries, but that do not exempt dividends paid to funds located outside the EU, may be invalid because the laws restrict free movement of capital.
As a result, U.S. investment fund, Emerging Market Series of DFA Investment. . .
See: The Effect of Profit Shifting on the Corporate Tax Base in the United States and Beyond, by Kimberly Clausing: SSRN
Japan and Chile have agreed in principle on a tax treaty, Japan’s Ministry of Finance announced . . .
It is “imperative” that the US change its international tax system to a dividend exemption regime coupled with “robust and appropriate” base erosion rules, concluded the co-chairs of a US Senate bipartisan working group in a July 8 report. Senator Rob Portman (R-Ohio) and Senator Chuck Schumer (D-NY) said in the. . .
Final US anti-inversion regulations published June 4 retain the 25 percent bright-line test of temporary and proposed versions of the regulations for determining if an expanded affiliated group (EAG) is considered to have substantial business activities in a foreign country. The regulations . . .
The US Senate Finance Committee on April 30 released comment letters submitted to Senate working groups that are currently analyzing US tax reform options. The comments were submitted in . . .
The UK government has released regulations implementing automatic exchange of information under the European Union Revised Directive on Administrative Cooperation and under the Multilateral Competent Authority Agreement implementing the Common Reporting Standard. The regulations, released March 24, also make minor changes to existing rules implementing the UK’s FATCA agreement . . .
US Senator, Orrin Hatch, expected to be the next Chairman of the Senate Finance Committee, released a report December 11 which calls for the US to adopt a territorial tax system and suggests that the US consider adopting a patent or innovation box. The report . . .
New Zealand expects in 2015 to negotiate tax treaties or protocols with Korea, Australia, Norway, Slovak Republic, China . . .
Indian tax authorities have lodged an appeal in the Supreme Court contesting the February 5 decision of the Delhi High Court in e-Funds IT Solutions/e-Funds Corp v. DIT, reports the Financial Express in a November 5 article. In e-Funds, the Delhi High Court concluded . . .
A. Duane Webber will chair Baker & McKenzie’s Global Tax group, the firm announced at its annual meeting held October 7. Webber is based in Washington, DC. Release.
The government of Chile, on August 9, released a revised Tax Reform Bill, which incorporates 278 modifications to the bill originally submitted to Congress on April 2, writes KPMG Chile in an August tax alert. Included are significant changes to the corporate tax regime and rates, to thin capitalization rules, revisions to the treatment of goodwill amortization, and anti avoidance rules. For an analysis of the revisions, see KPMG (PDF 80 KB)
The Australia Taxation Office (ATO) has released draft guidance on how the ATO will administer and how financial institutions will comply with the FATCA intergovernmental agreement (IGA) between Australia and the United States. Comments on the draft are requested by July 18. Draft guidance
In a significant blow to the IRS, the US Tax Court has invalidated 2003 cost-sharing regulations that require related parties to share stock-based compensation costs in qualified cost-sharing agreements, finding that the regulations do not meet the standard of reasoned . . .
Congressional tax writers are getting behind a major new tax break for profits made on patent portfolios as part of their ongoing quest to identify ways to make the U.S. tax code business-friendlier. Source: Lawmakers Embrace Patent Tax Breaks – WSJ
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