Americas
UK updates FATCA schema and supporting documents
The UK on May 26 updated the schema and supporting documents for Foreign Account Tax Compliance Act (FATCA) software . . .
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Thailand transfer pricing law approved by Cabinet
Thailand’s Cabinet on May 7 approved a draft act introducing new transfer pricing provisions, including documentation requirements, writes PwC in a May 18 report. For details, see PwC.
Americas
US revenue rulings conclude that transactions involving foreign subs qualify under section 351 and as D reorgs
The US IRS on May 6 issued two revenue rulings that conclude that transactions amount to section 351 transactions followed by D reorganizations . . .
Europe
Sweden proposes to limit participation exemption, toughen withholding tax antiabuse rules
The Swedish government, on April 22, proposed legislative amendments that would disallow a tax exemption for dividends paid to a Swedish company that can be deducted as interest by the distributing company and that would strengthen antiabuse rules pertaining to withholding taxes, writes EY in an April 24 Global Tax Alert. See, EY.
Americas
Canadian budget provides withholding tax relief for some non-resident employers, plugs captive insurance loophole
International tax provisions in the Canadian government’s budget 2015, released April 21, provide withholding tax relief to non-resident employers whose employees work in Canada for short periods of time and tighten an antiavoidance rule applicable to captive insurance . . .
Americas
Former US House Ways & Means Chairman Dave Camp joins PwC
Former US House of Representatives Ways and Means Committee Chairman Dave Camp (R-MI) has joined PwC as a senior policy advisor in its Washington National Tax Services practice, the firm announced . . .
Europe
Liechtenstein and Italy sign tax information exchange agreement
Liechtenstein Prime Minister Adrian Hasler and Italian Finance Minister Pier Carlo Padoan on February 26 signed a tax information exchange agreement (TIEA) based on the OECD model and a protocol and joint declaration on future cooperation in tax matters. The TIEA provides for exchange of information relating . . .
Africa
South Africa budget includes plan to rewrite rules on transfer pricing documentation, digital businesses
South Africa’s government intends to propose new transfer pricing documentation and reporting rules and to revise controlled foreign company (CFC) rules relating to the digital economy, according to 2015 budget documents released February 25. The proposals will be “in line with” the OECD work . . .
Europe
ECJ rules that UK limits on cross-border group loss relief are compatible with EU law
The European Court of Justice on February 3 ruled that a UK law that puts restrictions on the ability of group companies to offset gains with nonresident subsidiary losses is compatible with EU law, rejecting the European Commission’s claim that the law made it “virtually impossible” . . .
Multinational
OECD releases comments on proposed rules for low value-adding intra-group services
The OECD on January 20 published 65 comment letters on proposed amendments to the OECD transfer pricing guidelines that would provide for elective, simplified, rules for determining the amount of low value-adding intra-group services to be charged to and paid for by individual members of an MNE group. The draft, released November 3, 2014, responds . . .
Europe
Switzerland and Italy reach agreement on tax information exchange
The Switzerland and Italy have reached an agreement in principle to sign a protocol to their double tax treaty to make provision for the OECD standard for the exchange of tax information upon request, the Swiss government announced January 16. The countries have also initialed a roadmap . . .
Americas
US IRS updates FAQs on FATCA IDES system
The US IRS released updates to its frequently asked questions (FAQs) on the FATCA IDES system dated January 5. Under the “general questions” heading, the . . .
Asia-Pacific
India signs first bilateral APA
India signed its first bilateral advance pricing agreement (APA) on December 19, agreeing with Japan and a Japanese company to aspects of the company’s transfer pricing for five year term, according to a Central Board of Direct Taxes release. The CBDT said that the APA was finalized in about 18 months, and noted that this is a shorter period than most governments take to finalize an APA. See, release.
Featured News
Officials preview OECD draft on interest deduction limits, say more BEPS guidance out this week
An OECD discussion draft scheduled to be released this week includes a proposal to put limits on an MNE’s net interest deductions based on worldwide net third party interest expenses, OECD officials said December 15 during a webcast updating work on the OECD/G20 base erosion and profit shifting (BEPS) project. Officials also said that the OECD intends . . .
Europe
ECJ rules that UK law attributing gain to participators of close companies violates the TFEU
The European Court of Justice on November 13 ruled that UK legislation that immediately attributes gains made by non-resident closely held companies to participators of the companies that are UK residents is a restriction on the free movement of capital as defined . . .
Americas
US Tax Court permits deductions for premiums in captive insurance arrangement
The US Tax Court in Securitas Holdings Inc. v. Comm., released October 29, has ruled that payments made under a brother-sister captive insurance arrangement were deductible insurance premiums because . . .
Europe
Switzerland adopts negotiation mandates for automatic information exchange
Switzerland’s Federal Council on October 8 released final negotiation mandates for introducing automatic exchange of information in tax matters with the EU, the United States, and other countries . . .
Americas
Canada proposes international tax changes, puts anti-treaty shopping rules on hold
Canada’s Department of Finance has released proposed international tax legislation, including measures to implement the government’s 2014 budget, but said it decided to postpone action on anti-treaty shopping legislation.
The proposals, released on August 29, include amendments to Canada’s foreign affiliate dumping rules . . .
More analysis: KPMG
Europe
Ewelina Stamblewska-Urbaniak now heads transfer pricing practice of Taxand Poland
Ewelina Stamblewska-Urbaniak has joined Crido Taxand as head of the firm’s transfer pricing practice based in Warsaw, Poland. release
Americas
U.S. Joint Committee report analyzes international tax proposals
The U.S. Joint Committee on Taxation released a report on July 21 entitled “Present Law And Background Related To Proposals To Reform The Taxation Of Income Of Multinational Enterprises.” The report was prepared in connection with a Senate Finance Committee public hearing scheduled for July 22 on the taxation of cross-border income. Report, Prior coverage
Europe
Macedonia planning financial zone with tax breaks for multinationals
Macedonia will soon release draft legislation that will create a financial zone and tax breaks to companies that locate their headquarters there, said Prime Minister Nikola Gruevski, according to a July 18 article by Sinisa Jakov Marusic of BalkanInsight. For details, see BalkanInsight.
Europe
EU passes amendment to stop hybrid loan mismatches
The Council of the European Union, on July 8, formally adopted an amendment to the parent-subsidiary directive to prevent multinational groups from achieving double non-taxation from hybrid loan arrangements. A political agreement on the matter was reached on June 20. States have until December 31, 2015, to add the amendment to their laws. Press release; Amendment to Council Directive: 10996/14, 11291/14, 11291/14 ADD1; Prior coverage
Americas
Europe
France and Spain agree to improve exchange of tax information
French Finance Minister Michel Sapin and Swiss Finance Minister Eveline Widmer-Schlumpf, on June . . .
Europe
EU VAT expert group seeking business feedback
The VAT Expert Group, charged with assisting and advising the European Commission
Europe
EU Commission seeking new members for VAT expert group
The European Commission, in a June 5 announcement, has requested applications from value added tax (VAT) specialists to serve on the Commission’s VAT Expert Group . . .
What's New
Switzerland adopts draft negotiation mandates for automatic information exchange
Switzerland’s Federal Council, on May 21, announced draft negotiation mandates for introducing automatic exchange of information in tax matters with partner states. The announcement follows Switzerland’s endorsement of the OECD’s Declaration on Automatic Exchange of Information in Tax Matters on May 6. See, release.
Americas
U.S. transfer pricing official concerned about BEPS project, clarifies transfer pricing roadmap
The OECD’s Base Erosion and Profit Shifting (BEPS) initiative has increased tax controversies between nations and is likely to continue to do so in the future, Samuel Maruca, U.S. IRS Director of Transfer Pricing Operations said April 30.
“My fear is that some of our treaty partners view this as a license [and are] reaching out and helping [themselves] to the tax base,” said Maruca, who spoke during a webinar sponsored by EY. Maruca . . .
Americas
U.S. extends PFIC notice on government bonds
The IRS, in Notice 2014-31 released April 24, extended until 2016 Notice 2012-45, dealing with the treatment of government bonds under the passive foreign investment company (PFIC) rules. Notice 2014-31 (PDF 10K)
Americas
US and India still dispute transfer pricing margins
The US and India remain at loggerheads over the percentage of profit to be allocated to India subsidiaries of US IT and ITeS companies, with US pushing for a 12 – 13 percent rate and India unwilling to go below 18 percent, according to a an April 9 Financial Express article written by Santosh Tiwari. An unnamed official quoted by Tiwari suggested that “the way forward could be to tackle the existing cases at a higher rate and new cases at the rate closer to what the US wants.” Read More: Financial Express
Europe
Ireland resolves 9 MAP cases in 2014, expands competent authority staff
Ireland resolved 9 mutual agreement procedure (MAP) cases with other nations in 2014, leaving inventory of 22 unresolved MAP cases by the end of that year, Irish Revenue said in a report, released on November 9. The report . . .
Asia-Pacific
United States and Azerbaijan sign Model 1 FATCA IGA
The US Treasury Department has updated its FATCA website, reporting that Azerbaijan and the US signed a Model 1 intergovernmental agreement . . .
Europe
Asia-Pacific
Australia to introduce MNE tax avoidance legislation September 16 – Business Spectator
“Powerful vested interests will be very upset about this,” Australia’s Treasurer Joe Hockey said, according to a September 7 article by Adam Creighton of the Business Spectator. See: Business Spectator. Related: MNE Tax.
Americas
US and Portugal sign Model 1 FATCA IGA
The US Treasury Department has updated its FATCA website, reporting that Portugal has signed a Model 1 intergovernmental agreement (IGA) with the United States . . .
Asia-Pacific
Europe
EU Court rules that active holding companies may recover VAT, German law excluding partnerships from VAT groups needs review
The European Court of Justice on July 17 ruled that active holding companies may recover VAT on share acquisition costs and that German courts should determine the appropriateness of a German law that does not allow partnerships to be included in VAT groups . . .
Multinational
OECD and UN officially launch Tax Inspectors Without Borders initiative
OECD and the United Nations Development Programme (UNDP) officials on July 13 formally announced the launch of the Tax Inspectors Without Borders program at the UN’s Third International Conference on Financing for Development held in Addis Ababa, Ethiopia. The new program recruits currently serving or recently retired . . .
Multinational
WCO releases new guide on relationship between transfer pricing and customs valuation
The World Customs Organization (WCO) has a published a guide for customs officials designed to move the debate forward on the issue of the harmonization of customs valuation and transfer pricing valuation.The guide . . .
