What We're Reading–MNE Tax

Europe

‘Single malt’ multinational tax avoidance techniques still being exploited via Ireland-Malta intercompany transfers despite 2019 agreement between the countries to end the practice, charity claims: Pat Leahy / The Irish Times→

September 15, 2021

Russia

Russia proposes new taxes on digital services provided by foreign tech firms with aim to spur growth of domestic alternatives: Reuters→

September 14, 2021

Multinational

Non-OECD, non-G20 countries have joined multilateral tax Inclusive Framework primarily due to combination of EU tax haven ‘naming and shaming’ and acculturation through prior involvement with OECD: Shu-Yi Oei / SSRN→

September 14, 2021

Europe

EU is only marginally successful in using state aid doctrine to combat profit-shifting transfer pricing arrangements, but the approach has achieved more so far than legislative remedies: Shafi U Khan Niazi & Richard Krever / Austaxpolicy→

September 9, 2021

Europe

Poland plans minimum tax for large corporations equal to 0.4% of revenues ‘plus 10% of expenses used for tax optimisation purposes’: Reuters→

September 8, 2021

Asia-Pacific

Australian Taxation Office challenges in court availability of legal professional privilege for tax advice offered by Big 4 accounting firms: Paul McNab / Linkedin→

September 8, 2021

Multinational

Nobel-winning economist Joseph Stiglitz praises global minimum tax efforts but says 15% rate is too low, urges rate of at least 20% to address ‘dark side of globalization’: Brigitte Hagemann (AFP) / Yahoo News→

September 7, 2021

Africa

South Africa seeking to amend tax treaties with Germany, Switzerland, and Eswatini to crack down on tax avoidance and boost tax information exchange: Lameez Omarjee / Fin24→

September 3, 2021

Multinational

Objections to regulatory efforts to curb international tax arbitrage have merit but should not deter international cooperative efforts to tackle exploitation of mismatches in tax laws: Ruth Mason and Pascal Saint-Amans / SSRN→

September 2, 2021

Americas

US global intangible low-taxed income (GILTI) reform should address diminishing effect the provision has on domestic loss deductions for US companies with concurrent foreign profits: Daniel Bunn / Tax Foundation→

September 2, 2021

Americas

US business lobbying groups optimistic they can pick off enough Democratic lawmakers with concerns about economy and US competitiveness to water down proposed corporate and international tax hikes: Karl Evers-Hillstrom / The Hill→

August 31, 2021

Africa

Most favored nation clauses in tax treaties between high- and lower-income countries operate to the disadvantage of the latter, resulting in significant tax base erosion: Deepak Kapoor / ICTD→

August 26, 2021

Americas

US IRS opens 2022 Compliance Assurance Process application period for large corporate taxpayers seeking to enter program for resolving compliance issues before filing of tax return: US Internal Revenue Service→

August 23, 2021

Asia-Pacific

Russia looking into revising tax treaties with Switzerland, Hong Kong, and Singapore, according to government official, following three other recent treaty revisions and renunciation of Dutch treaty: Fahad Shabbir / UrduPoint News→

August 23, 2021

Europe

EU General Court decision in Engie, confirming Commission’s approach, transforms state aid prohibition into sweeping anti-avoidance measure, blurring line between legal tax minimization and abuse: Joachim Englisch / SSRN→

August 20, 2021

Americas

Barbados planning measures to counter effect of global minimum tax, including using increased corporate tax revenues to provide R&D grants to companies paying the higher taxes: Marlon Madden / Barbados Today→

August 20, 2021

Africa

Cape Verde and Singapore signed tax treaty on August 17: Cabo Verde Inforpress→

August 19, 2021

Multinational

Share of profits shifted to tax havens remained roughly constant globally (9%–10%) in latest data (2018) despite OECD BEPS implementation and increased in US (19%–23%) despite enactment of 2017 tax law: Thomas Tørsløv, Ludvig Wier & Gabriel Zucman / Missing Profits→

August 18, 2021

Multinational

Tax is ‘a bigger corporate risk than ever’ due to enhanced country-by-country reporting and ongoing global tax talks, investors should be wary of companies that are not transparent about tax dealings: Richard Murphy / International Investment→

August 18, 2021

Europe

Hungary will not agree to give up its 9% corporate tax rate to join global minimum tax – government official insists – neither at the behest of Brussels, nor Washington: Hungary Today→

August 16, 2021

Americas

British Virgin Islands Finance panel suggests global minimum tax will not necessarily upend jurisdiction’s zero-tax rate nor dramatically impact types of businesses that locate there: Claire Shefchik / BVI Beacon→

August 13, 2021

Asia-Pacific

Singapore joins multilateral convention to implement tax treaty related measures to prevent base erosion and profit shifting: OECD→

August 11, 2021

Africa

Maldives, Papua New Guinea, and Rwanda join multilateral treaty for international tax cooperation and exchange of information: OECD→

August 11, 2021

Americas

US foreign-derived intangible income (FDII) deduction may be imperfect, but Congress should not repeal without evaluating how doing so could incentivize US companies to move intellectual property assets overseas: Daniel Bunn / Tax Foundation→

August 11, 2021

Multinational

OECD’s ‘Inclusive Framework’ has failed to give developing countries enough of a voice to affect international tax reforms and the resulting discontent will threaten the stability of the international tax regime: Yariv Brauner / SSRN→

August 11, 2021

Americas

US Congress should take up international tax reform without waiting for OECD talks to conclude, because US can benefit from changes regardless of global deal and acting first will strengthen US negotiating position: The FACT Coalition→

Multinational

Exchange of information agreements reduce multinational corporation tax-motivated profit shifting, data study shows, but newer and more advanced agreements do so more effectively: Devan Mescall and Paul Nielsen / Canadian Tax Journal→

Americas

US IRS ‘practice unit’ outlines agency process for applying penalty for failure to include reportable transaction information with tax return: Internal Revenue Service→

Europe

Irish Central Bank Governor says he’s not significantly worried about effect of corporate tax rate change on Irish economy, but impact will depend on internationally agreed rate, carve-outs: Johanna Treeck / Politico→

OECD

Inclusive Framework’s statement on international tax reform does not contain stringent enough terms to ensure MNEs are taxed where economic activity occurs but may be an important step in that direction: The BEPS Monitoring Group→

Africa

New Lesotho–Mauritius tax treaty replaces 1997 treaty connected with African countries’ concerns regarding MNE use of shell companies in Mauritius to dodge taxes: International Consortium of Investigative Journalists→

Americas

US bill would create tax credit for US companies investing in Puerto Rico and other US territories to offset impact of global intangible low-taxed income (GILTI) provisions: Laura Weiss / Roll Call→

Europe

Ireland and Kenya signed double tax treaty on July 21: Irish Department of Foreign Affairs→

United States

US bill introduced to establish border carbon adjustment that would impose fee on carbon-intensive imports to account for costs US businesses incur in complying with environmental standards: Senator Chris Coons (D-Del.)→

Europe

Gibraltar announces increase in corporate tax rate from 10% to 12.5% to ease transition to anticipated 15% rate under proposed global minimum tax agreement: Gibraltar Chief Minister’s Budget Address 2021→

Ireland

Global minimum tax negotiations could land at ‘a bit higher’ rate than 15%, OECD tax director Pascal Saint-Amans says, adding that agreement will proceed with or without Ireland: Irish Times→

Multinational

Multinational companies could manipulate financial statements to dodge taxes under OECD proposed tax rules unless issues addressed by accounting reform: Richard Murphy / Tax Research UK→

Asia-Pacific

Philippines and Brunei signed tax treaty on July 16: Philippines Department of Finance→

OECD

US nonpartisan agency’s review of Pillars 1 & 2 reports US companies may prefer Pillar 1 adoption to alternative of digital services taxes, while Pillar 2 would allow for more government tax revenues: Congressional Research Service→

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