Int'l Tax News

The European Court of Justice has doubled down on its position aboutwhen multinational companies can deduct losses from defunct subsidiaries. The court in its ruling backed a Danish auto parts retailer, and its parent company, saying that Danish tax authorities violated European Union rules by denying the parent company the ability to deduct losses of a non-resident subsidiary.

The new tax law handed most of the top 50 Fortune 500 companies a collective $137 billion in one-time benefits,while imposing nearly $20 billion in charges on the others due to its effect on their deferred tax assets and liabilities, according to a Bloomberg Tax analysis.

Foreign-owned companies in Brazil are struggling to dealwith a sudden reduction in tax credits and fiscal benefits. The government has agreed to create a subsidy for diesel fuel, butwill pay for it by cutting certain tax breaks and tax credits for companiesÔøΩmoves thatwill impact multinational companies and their subsidiaries.

Swiss lawmakers agreed to sweeten a controversial tax reform bill to make sure it doesn't fall victim to a voter referendum that could spur an exodus of Swiss-based multinational companies.

Tax professionals arewatching closely as two-year-old IRS anti-inversion rules are simultaneously being appealed in federal court and reviewed by the Office of Management and Budget.

The European Commission June 7 rejected claims by Sweden, Denmark, and Finland that the new U.S. tax reform law solves issues of European tax avoidance by large U.S. tech companies.

Australia's tax chief Chris Jordan has claimed some of the credit for an expected A$10 billion ($7.6 billion) boost in income tax revenue from large companies this year compared to 2017. Australia's implementation of its strict anti-avoidance law, targeting multinational companies engaged in aggressive tax planning, is among the reasons for the boost.

U.S. spending on consultants hit a fresh record last year as executives and government officials sought advice on navigating the new tax law and evolving technology, according to a report by Source Global Research releasedwednesday.

The IRS unit that resolves intercompany pricing issues is undergoing organizational changes as part of an agency-wide mandate, as enforcement approaches and rules are refinedworldwide.

The Dutch government has published a draft law thatwill sharply curtail the amount of interest thousands of resident group companies are allowed to deduct from their taxable profits.

Willis Towerswatson has found a creativeway to proactively identify tax risks in the changing landscape by using a human resources analytics tool, a director from the company said.

Some businesseswonderwhether the U.S. Treasury could cover the cost of the U.K.'s "Google tax." "The starting point is that a foreign tax may be creditable in the U.S. either under the applicable tax treaty, or under unilateral provisions in U.S. law for granting a tax credit," U.K. barrister Philip Baker QC said. "If it is creditable, then the U.S. Treasury effectively bears the burden."

The U.K. and Canada are close to ratifying the OECD's super-tax treaty as it enters into effect in July, according to the countries' government officials.

The IRS and seven other tax administrations, aswell as eight multinational companies,will gather in July for a midpoint evaluation of a pilot project designed to limit cross-border disputes, an IRS Official said.

The U.S. Treasury Departmentwill give multinational corporations some but not all ofwhat theywant in closelywatched international-tax regulations needed to implement the 2017 tax law, a senior Treasury official said Monday.

Multinational companies are still plagued by India's aggressive tax system, despite the country's claim that it has taken steps to encourage investment.

Chilean President Sebastian Piñera has ruled out a reduction in the top corporate tax rate in upcoming legislation to simplify the tax system, citing squeezed public finances.

The new U.S. tax law addresses international concerns about base erosion and profit shifting more thoroughly than any other jurisdiction's rules, a Treasury official said. The legislation "is actually, in my view, the most far-reaching implementation of BEPS principles that I'm aware of," according to the Treasury official.

The San Francisco Foreign Tax Club sent the Internal Revenue Service a laundry list of guidance requests on the 2017 tax act's base erosion and anti-abuse tax (BEAT) to help the tech industry navigate the law's ambiguities.

Italy's new government may introduce the flat tax that the two coalition parties agreed to in 2019 for companies and in 2020 for individuals, League senator Alberto Bagnai said in an interview.

According to companies, profitswere great in the first quarter. According to government statistics, not so much.

Corporate profitswere bolstered in the first quarter by tax cuts enacted at the end of 2017, but the underlying trend showed some signs of strain.

Britain is takingwhat a minister has described as an "active role" in shaping new EU value added tax regulations for the 2020s, suggesting the Treasury is planning for the UK to remain inside the bloc's VAT area after the Brexit transition period.

The U.K. government is privately exploring new guidance around the taxation of cryptocurrencies such as Bitcoin, Ripple, and Ethereum, according to a personwith knowledge of the matter.

An Indian judicial body spared a U.S. tech company from paying royalty taxes on income from its Indian subsidiary, a reprieve that contradicts a recent judgment involving Alphabet Inc.'s Google.

More than a half dozen of the biggest U.S. banks reduced their holdings of state and local government bonds by billions of dollars after the federal government slashed corporate tax rates, making the securities less valuable to one of the market's key buyers.

The possibility of a higher value-added tax rate in Russia could hurt the manufacturing sector and slow already sluggish economic growth, economists told Bloomberg Tax.

A May 31 judgment from the EU's second-highest court sends a message that European governments have little chance of appealing government-aid decisions by alleging a short-term competitive disadvantage from staggered edicts, practitioners said.

One of the tax law's new U.S. international tax provisionswill hit corporations even harderwhen it's applied at the state level, because states don't recognize the foreign tax credits granted at the federal level.

India's commerce ministry has asked for an examination of the recentwalmart-Flipkart acquisition deal to probe a potential violation of the country's foreign investment and tax rules, according to a statement from the ministry.

German Chancellor Angela Merkel's call to put a value on data in order to tax it like a tangible product is fraughtwith unknowns and could place a huge burden on business, analysts told Bloomberg Tax.

The top 55 companies on the 2017 Fortune 500 list expect to pay about $131 billion in taxes on their earnings stockpiled overseas. The amounts those companiesÔøΩexcluding the ones that are private or government-sponsoredÔøΩare disclosing in their earnings reports show that the revenue from the law's repatriation taxwill likely fall far short of lawmakers' and the Trump administration's expectations.

An Australian Senate committeewrapped up a four-year inquirywith a call for public tax and profit reporting for multinational companies. The Senate Economics Reference Committee, in a report released May 30, also recommended that all companies and trusts publicly disclose information about beneficial owners.

Companies in Brazil have been given an additional four months to prepare for the startup of a controversial law permitting lienswithout a court order on any asset owned by a firmwith tax debts.

Australia's chief for international tax haswarned some multinational companies that they could face a tax bill in the future if they arrange their affairs to principally obtain a local or foreign tax benefit.

Amazon.com Inc. and eBay Inc., two of theworld's largest online marketplaces, have put pressure on their rivals by publicly signing up to the U.K.'s latest efforts to crack down on value-added tax fraud.

Canada's proposed legislation to implement measures to combat aggressive tax planning go significantly beyond the minimum requirements agreed to at the international level.

EU member stateswill approve a new set of guidelines to clarifywhen a tax measure has been granted to a companywith no real economic activity during an EU finance ministers' meeting on June 22.

In this article, the author considers how the U.S.worldwide tax system has changed under the Tax Cuts and Jobs Act, and challengeswhether it should be called a territorial systemwhile proposing a new name.

Mark Leeds of Mayer Brown has asked Treasury to address some of the issues that have arisen in connectionwith the base erosion antiabuse tax under section 59A.

A think tank has recommended that G-20 leaders adopt a common minimum corporate tax rate and a common corporate tax base (CCTB) to reduce harmful tax competition and level the playing field for taxation and investment.

In this article, the author examines Swiss Tax Proposal 17, a major initiative thatwould abolish the special cantonal tax regimes, create research and development incentives, and otherwise change existing law. In addition to discussing the major points of the proposal, he evaluateswhether the changeswould complywith fundamental principles of Swiss law andwhether theywould effectively accomplish the dual goal of making Switzerland tax-attractive and ensuring it is compliantwith international tax standards.

Last year's tax-code overhaul slashed the rates companies pay, but limited an important break-ÔøΩthe deductibility of interest payments. Now, companies are exploringways to sidestep that change and billions of dollars in tax each year.

On May 25white House Director of Legislative Affairs Marc Short said the Trump administration isworkingwith Congress to draft a second phase of tax cuts and hopes to release a legislative package before the end of the summer. According to Short, this phase is "focused on the individual side." Most observers are skeptical that "Tax Reform 2.0"will be passed in 2018. And even if a second tax bill does make it through Congress this year, changes to the international provisions of the code aren't a priority. Still, it'sworthwhile to askwhat Congress could do to fix some of the damage to the international tax system caused by the TCJA.

Karen Sowell of the New York State Bar Association Tax Section has responded to a request for comments (Notice 2017-38) on burdensome tax regulations, offering suggestions on how to treat some provisions of the final and temporary debt-equity regs (T.D. 9790) issued in October 2016.

Finance ministers of the European Union's three Nordic countries have urged their partners to shelve a plan to tax large corporations for their digital turnover, saying it could damage the European economy.

Philippine President Rodrigo Duterte said hewill let lawmakers decidewhat to dowith a tax law that his administration lobbied for and is now being partly blamed for rising prices.

The renaissance in capital spending the tax cutwas supposed to bring about isn't showing up in the economic data.

The U.S., U.K., and India are among 28 countries that need to improve their domestic laws and regulations related to the first-ever exchange of global tax reports, the OECD said ahead of next month's exchanges. The OECD, in its first peer review of the reporting initiative released May 24, gave 28 jurisdictions one or more recommendations to modify specific parts of their legal and administrative framework.

The European Union's plans for a 3 percent digital transaction taxÔøΩon companies such as Alphabet Inc.'s Google, Amazon Inc. and Facebook Inc.ÔøΩis under fire for lacking legal backing because of problems identifying the location of consumers targeted by advertising.