Latest

The agreement on international tax reform that was endorsed by the majority of the 139 “Inclusive Framework” countries on July 1 grew one country stronger on August 12 as Barbados became the latest . . .

Americas

Singapore guidance on intercompany financing: two illustrations

New York City Economist Dr. J. Harold McClure analyzes two examples the Inland Revenue Authority of Singapore (IRAS) provided on August 10 in the sixth edition of its e-tax transfer pricing guidance, extending its coverage of . . .

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→

Asia-Pacific

India withdraws retrospective amendment to tax indirect transfers, big relief for many multinationals

Anjul Mathur and Amit Sharma, RSM India, discuss India’s August 4 introduction of a new regulation to withdraw a 2012 amendment, with retrospective effect from 1961, under which the indirect transfer of assets located in India and owned by non-residents was taxed . . .

Accounting

US IRS updates accounting method rules for taxable year of inclusion, credit card fees

August 12, 2021

On August 12, the US Internal Revenue Service outlined procedures (Revenue Procedure 2021-34) for obtaining automatic consent to change methods of accounting to comply with final rules issued in 2020 under Internal Revenue Code Section 451 relating to the taxable year of . . .

Asia-Pacific

Taiwan amends tax treaty rules on residency, permanent establishment, treaty abuse

August 12, 2021

On August 12, Taiwan’s Ministry of Finance promulgated amendments to the regulations governing the application of double tax treaties to update the decade-old rules for developments in international tax trends and conventions, improve administrability, and . . .

Asia-Pacific

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

Africa

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

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→

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→

Americas

US bill proposing tax on corporate book income could undermine R&D incentives

A bill announced by US Senator Elizabeth Warren (D-Mass.) on August 9 would impose a tax on the income that large corporations report to their shareholders with an aim to prevent those corporations from using “loopholes” – including tax incentives, like the research and development (R&D) tax credit . . .

Americas

US infrastructure bills clear hurdles, still waiting on corporate tax provisions

The US Senate on August 10 approved President Biden’s USD 1 trillion bipartisan traditional infrastructure bill, while on August 11 Senate Democrats adopted the framework for a USD 3.5 trillion partisan “human infrastructure” budget bill. Neither bill, as yet, includes corporate tax measures . . .

Asia-Pacific

Singapore updates transfer pricing guide to address cost-sharing, financial transactions

August 10, 2021

The Inland Revenue Authority of Singapore on August 10 published the sixth edition of its e-tax guide on transfer pricing, adding a new chapter on cost contribution arrangements, expanding guidance on . . .

Americas

Brazil’s upcoming tax reform will impact inbound investors

August 10, 2021

Luis Felipe de Campos, Rolim, Viotti, Goulart, Cardoso Advogados, discusses the substitute tax reform bill that Brazil’s Ministry of Economy presented to Congress on June 25, including provisions affecting corporate tax rates, profit distributions, interest . . .

Americas

Colombian tax reform proposes corporate rate increase, tax avoidance measures

August 10, 2021

María Helena Padilla, Pinilla, González y Prieto Abogados, discusses the Colombian government’s introduction of a tax reform bill on July 20 that includes an increase in the corporate tax rate, new measures to . . .

Accounting

IASB proposes amendment for insurers, European accounting group responds

August 9, 2021

The International Accounting Standards Board (IASB) on July 28 proposed a limited change to the transition requirements in International Financial Reporting Standards (IFRS) 17, Insurance Contracts, intending to address . . .

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→

August 9, 2021

Asia-Pacific

Hong Kong tax agency advises on tax and transfer pricing effects of Covid-19

August 9, 2021

The Hong Kong Inland Revenue Department on July 29 clarified its approach to the disruptions caused by Covid-19 with respect to various tax issues, including issues related to tax residence, permanent establishment . . .

Americas

Panama Papers: Luxembourg court confirms tax agency’s authority to request information from lawyers

August 6, 2021

Rafael Rivera, Managing Partner and Tax & Legal Partner at BDO Panama, discusses the Luxembourg High Administrative Court’s July 13 decisions – pertaining to the so-called “Panama Papers” cases – that overruled a lower court and held that the tax administration . . .

Europe

Spain tightens international tax transparency rules and introduces concept of ‘non-cooperative jurisdictions’

August 5, 2021

Abigail Blanco Vázquez and Álvaro de la Cueva of J&A Garrigues, S.L.P., discuss Spain’s law published on July 9 to prevent and combat tax fraud (Law 11/2021), triggering changes to various tax concepts and to the general taxation law itself. Provisions in the anti-fraud law affecting corporate income tax and . . .

Africa

US FDII deduction among international ‘harmful tax practices’ slated to be abolished

August 5, 2021

An update on reviews of preferential tax regimes published by the OECD on August 5 states that the US foreign-derived intangible income (FDII) regime is “in the process of being eliminated.” The new report includes updated conclusions with respect to 18 designated . . .

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→

August 5, 2021

Americas

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

Africa

Countries take diverse transfer pricing approaches to financial transactions, profit attributions

Updated transfer pricing country profiles released by the OECD on August 3 include for the first time information on 20 reviewed countries’ transfer pricing rules applicable to . . .

Asia-Pacific

Russia’s new double tax treaty policy: the score is 3 to 1

Roustam Vakhitov, Crowe Expertiza, analyzes Russia’s new tax treaty policy following the government’s June 7 notice to the Dutch government of Russia’s intent to terminate the double tax treaty between the two countries after a failure to . . .

Denmark

Denmark proposes easing transfer pricing documentation requirements between related Danish companies

Rasmus Christian Johansen, Danish Tax Agency, discusses the Danish Ministry of Taxation’s June 23 proposed draft amendments to the Danish Tax Control Act to relax the transfer pricing documentation requirements for some . . .

Europe

Poland business transfer pricing forum advises on Covid-19 impact

August 3, 2021

Dr. Monika Laskowska at the Center of Tax Analyses and Studies, Warsaw School of Economics, discusses the Polish Ministry of Finance’s July 13 publication for public consultation of recommendations on the impact of Covid-19 on transfer pricing . . .

Asia-Pacific

India’s first year of ‘faceless’ tax assessments runs into legal issues

August 3, 2021

Suranjali Tandon from the National Institute of Public Finance and Policy, New Delhi, analyzes several court decisions issued in June and July that highlight implementation issues with India’s new “faceless” – i.e., digital – tax assessment scheme, which was intended . . .

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→

August 3, 2021

Accounting

South African tax bill would amend rules on interest deductibility, assessed losses

On July 28, the South African Revenue Service and National Treasury released various draft tax bills that would enhance the rules relating to the limitation on interest deductions on payments to persons not subject to tax and would restrict the set-off of the

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→

Africa

Ireland, Lithuania, Hungary offer lowest tax rates for R&D, OECD study finds