Luxembourg’s Parliament on December 18 passed a law which sets out the procedures required to obtain a private tax ruling, thereby formalizing existing administrative practice, and which describes the application of the arm’s length principle in transfer pricing, writes EY in a December 19 tax alert. For discussion of the new legislation, see EY
Michael Durst has joined the UN Committee of Experts Subcommittee on Natural Resources Taxation, reports the International Centre for Tax and Development (ICTD) in an October 10 release.
Durst is an ICTD researcher and writes . . .
China’s State Administration of Taxation has instructed tax bureaus across China to survey companies regarding service fees and royalties paid to related parties between 2004 and 2013, to report back to the SAT on their findings, and to initiate audits of companies that have made suspicious payments, KPMG writes in an August tax alert. For details, see, KPMG. See also, EY.
Witnesses testifying before the US Senate Committee on Foreign Relations on October 29 urged the committee to recommend ratification of eight pending US tax treaties and protocols, highlighting key aspects of the . . .
European Commission President Jean-Claude Juncker told parliamentary committees January 17 that the EU should adopt rules governing private rulings . . .
Tax officials at a June 6 OECD consultation suggested that draft guidance on cost contribution arrangements (CCAs) will be modified to clarify how to value CCA contributions. Officials also requested stakeholder feedback to help refine aspects of draft guidance on transfer pricing for hard-to-value . . .
The United Nations Conference on Trade and Development (UNCTAD) on March 26 released a draft report that concludes that developing countries are losing about $100 billion every year from MNE tax avoidance through use of offshore hubs. Some 30% of cross-border corporate investment . . .
India’s budget, released February 28, introduces several tax changes of interest to business, including a deferral of planned general antiavoidance rules (GAAR), clarification of rules on indirect transfers of Indian assets, and the introduction of proposals to cut the corporate tax rate and widen the corporate tax base. In a . . .
The Australian Taxation Office (ATO) on February 26 released guidance on procedures that must be followed before ATO personnel can advance the view that a transaction must be reconstructed for transfer pricing purposes using one of the exceptions. . .
China signed 19 advance pricing arrangements (APAs) — 11 unilateral APAs and 8 bilateral APAs — in 2013, according to the State Administration of Taxation’s (SAT) annual APA report. The report, released December 5, provides data on China’s APA program from 2005-2013, outlines the process for obtaining an APA in China, provides forms and schedules needed to apply for an APA, and provides
. . .
The Czech Republic Supreme Administrative Court elaborated on the burden of proof in transfer pricing and incentive regimes cases in a ruling which concluded that a taxpayer did not qualify for incentive regime tax relief because it failed to prove it priced transactions with its subsidiary at arms length, writes KPMG in a November 17 report. For discussion, see KPMG.
Gregory Hartker has joined Morgan Lewis as of November 17 in firm has announced. Hartker joins . . .
The OECD’s planned guidance on the profit split method will likely consist of a series of examples that demonstrate when the method is considered the best method for transfer pricing purposes and how it should be . . .
Draft OECD guidance on hard-to-value intangibles released June 4 would permit tax administrations to consider ex post evidence of the actual financial outcome of a transfer of intangibles to determine the appropriateness of the ex ante pricing arrangement, including whether arm’s length parties would have used contingent pricing . . .
China’s State Administration of Taxation (SAT), on June 3, released English-language descriptions of SAT transfer pricing guidance, a circular reporting on the SAT’s efforts to curtail tax avoidance, and a paper outlining the changes required to transform China’s taxation system into one more truly governed by the rule of law. The SAT explained that its decision to release transfer pricing . . .
The OECD on June 1 released submissions from 45 organizations commenting on proposed revisions to the OECD transfer pricing guidelines dealing with cost contribution. . .
A few changes will be made to the UK’s controversial diverted profits tax in the final version of the legislation, set to be introduced next week, according UK budget documents released March 18. Proposed legislation to add country-by-country reporting requirements for MNEs . . .
OECD and G20 countries have agreed to a framework for country-by-country reporting by multinational corporations, to the criteria to assess whether preferential intellectual property regimes are harmful, and to a plan to create a multilateral instrument to implement tax treaty-related measures, the OECD said February 6. The agreements, which implement OECD/G20 base erosion profit shifting (BEPS) plan, will be . . .
UPDATE (2/10/2015): G20 finance ministers endorse plan for multilateral instrument: G20 finance ministers have agreed to a mandate to create a multilateral instrument to implement tax treaty-related measures under OECD/G20 the base erosion and profit shifting (BEPS) plan, the ministers said in a communique following their February 9-10 meeting in Istanbul . . .
The European Commission on December 19 invited interested parties to comment on its investigation into whether an advance pricing agreement (APA) granted by the Netherlands to a Starbucks subsidiary constitutes illegal state aid. The Commission said it currently. . .
The European Commission intends to analyze leaked Luxembourg private tax rulings for evidence of illegal state aid, the European Union’s new competition chief, Margrethe Vestager, said November 20. “We consider the Lux-Leaks documents as market information. We will examine [them] and also therefore evaluate whether or not this will lead us to . . .
The European Commission has concluded that public dissemination of country-by-country reporting by banks will not have a negative impact on the economy, paving the way for public release of the data by January 1, 2015. “At this stage, the public country-by-country reporting of information under Article 89 of Directive 2013/36/EU is not expected to have significant negative economic impact, in particular on competitiveness, investment, . . .
The Netherlands Ministry of Finance, on June 12, published five decrees updating guidance on advance pricing agreements (APAs), advance tax rulings (ATRs), and minimum substance requirements to obtain an APA or ATR, according to a report by Loyens & Loeff. Minimum substance requirements are also provided for service companies that do not have an APA that wish to apply the Dutch treaty network or the EU Interest & Royalty Directive. For details and analysis, see a June 12 report by Loyens & Loeff
Australia’s Federal Court has handed the Australian Taxation Office (ATO) an important victory, concluding that USD 2.5 billion of loans between Chevron’s Australian-resident company and its Delaware subsidiary made between 2004-2008 were not arm’s length and thus generated excessive interest . . .
The Netherlands should consider adopting new tax provisions to counterbalance the increased tax burdens placed on companies from OECD/G20 base erosion and profit shifting (BEPS) plan, State Secretary of Finance Eric Wiebes said. . .
Members of the European Parliament Economic and Monetary Affairs Committee have expressed disappointment with a deal struck October 6 for a EU directive on automatic exchange of tax ruling i. . .
Ecuador’s Internal Revenue Service has released regulations outlining new transfer pricing documentation requirements, EY writes in a July 31 tax alert. See: EY
Representatives of nine multinational pharmaceutical companies will defend their companies’ tax practices before the Australian Senate’s Economics References Committee on July 1 as a part of the committee’s ongoing inquiry into tax avoidance and aggressive tax . . .
The Netherlands goverment supports expanding public release of country-by-country data beyond the extractive and banking industries to all companies, Eric Weibes, State Secretary of Finance . . .
Spain has enacted major tax reform, including corporate tax reform, effective January 1, 2015, writes Deloitte in a December 2 alert. The corporate tax changes include a reduction in tax rates for 2015 and 2016, anti-hybrid rules and . . .
The OECD’s Working Party 6 (WP6) has decided to not add materiality thresholds to OECD guidance on transfer pricing documentation and country-by-country reporting, WP6 delegates said on May 19, during a day-long consultation on a draft of the guidance.
US delegate, Michael McDonald, said that WP6 decided it can not provide any explicit guidance on materiality other than to say that materiality is a local country issue.
“Quantitative materiality thresholds are very difficult. . .
The European Union’s Joint Transfer Pricing Pricing Forum has published profiles of the transfer pricing policies of all EU member states, including competent authorities’ contact details and other information. JTPF Country Profiles
Japan’s Ministry of Finance has advised that on November 30 Japan and Qatar exchanged diplomatic for the entry into force of the Japan-Qatar tax treaty, signed . . .
The EU Joint Transfer Pricing Forum has released statistics for 2014 on EU nation advance pricing agreements (APAs) and on pending . . .
The G-20 finance ministers have endorsed the final reports responding to the OECD/G20 base erosion profit shifting (BEPS) plan . . .
The European Commission has announced that its current view is that Belgium’s excess profits tax ruling system provides for a selective advantage tantamount to State aid, and has requested stakeholder comments on this determination by July 5. According to the Commission, about 50 companies have used the program to reduce . . .
The OECD’s Pascal Saint-Amans sought to allay Australian lawmakers’ fears that the OECD will fail in its mission to curb tax avoidance through its base erosion and profit (BEPS) plan during an Australian senate hearing, as the senators weighed whether they should support immediate unilateral tax measures to protect . . .
Delhi High Court in a March 16 decision said it disagreed with the Indian tax department’s method of analyzing the transfer pricing aspects of payments made by Indian subsidiaries for advertisement, marketing, and sale promotion (AMP). The Court also concluded. . .
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