Int'l Tax News

An OECD official told the European Parliament’s subcommittee on tax matters that the way capital gains are taxed in OECD countries could lead to tax minimization strategies, inequities, and the loss of revenues.

Sweden’s interest limitation rule that denies an interest deduction for a cross-border intercompany loan to finance an intragroup reorganization violates the freedom of establishment guaranteed by the EU treaty, a Swedish court has held.

Paul W. Oosterhuis offers proposals for determining which taxes the multinational tax community can agree are properly imposed as income taxes and proposals for determining what taxes other countries should defer to, either through foreign tax credits or income exemptions.

Belgian Finance Minister Vincent Van Peteghem told members of the European Parliament that the EU needs to take the lead in the discussion regarding pillar 1 of the OECD’s global corporate tax plan.

Extractives industry groups and other stakeholders have voiced concerns over a recent OECD proposal to amend the model tax convention commentary by including a 30-day permanent establishment threshold for natural resource extraction.

More than 100 tax academics from 17 EU member states are calling for the creation of an EU agency for tax cooperation to facilitate the exchange of information, particularly regarding VAT and excise taxes.

Lee A. Sheppard examines the foreign tax credit recapture and Schedule UTP aspects of Liberty Global and details why the Tax Court rejected Liberty Global’s argument that its capital gain in excess of its overall foreign loss should be exempt from U.S. tax.

Treasury is considering issuing proposed regs on sourcing rules for cloud transactions as companion regulations to finalized rules regarding characterization.

The 2021 global tax agreement could have “a discriminatory impact” by hurting predominantly non-white nations’ ability to collect taxes and pay for vital services for their people, according to nine experts who have been appointed by the UN Human Rights Council to report and advise on human rights issues. 

Philippine Finance Secretary, Ralph Recto, pledged to focus on boosting tax collection and sustaining current spending as he took over the job on Friday in the first revamp of President Ferdinand Marcos Jr.’s economic team since he assumed power in 2022. 

New international tax rules will force multinational companies to pay an extra 6.5% to 8.1% in tax, according to the OECD. The impact will be felt most acutely by companies that use tax havens, euphemistically known as investment hubs. 

The OECD will soon begin working on broader guidance tackling hybrid arbitrage arrangements involving the pillar 2 global anti-base-erosion rules, and it could release that guidance this year, an OECD adviser said.

After soliciting public feedback on the OECD’s multilateral tax treaty in case any important issues were missed, the US does not plan to reopen negotiations of the document, according to a Treasury Department official. However, some consideration as to the definition of terms in the treaty may be made.

The Treasury Department is focused on finding a “principled” way to deal with novel extraterritorial taxes like digital services taxes as it considers changes to its foreign tax credit rules. 

Countries categorized as “investment hubs”, such as Ireland and the Netherlands, will have the largest expected gains from the reforms, with corporate income tax revenues rising from 14 per cent minimum to up to 34 per cent. 

Ryan Finley explains why it’s wrong to read special exclusions for items like goodwill into the cost-sharing regulations’ definition of a platform contribution.

The global anti-base-erosion rules could raise as much as $192 billion annually in extra corporate tax revenue and reduce low-taxed profits worldwide by more than two-thirds, according to an OECD working paper.

Treasury Secretary Janet Yellen says new requirements for beneficial ownership information reporting implemented by the department’s Financial Crimes Enforcement Network are leading to a noticeable improvement in tax transparency efforts.

Following President Gustavo Petro’s calls for a lower corporate tax rate, Colombia’s finance minister said the government is revising a proposal to gradually reduce the corporate tax rate from 35% to 30% in the coming years.

Martin A. Sullivan uses several data sets to explore how the substance-based income exclusion affects pillar 2 tax on the profits of U.S. multinationals in various industries and jurisdictions.

South Korea’s tax authority has created an international tax response team to administer new global minimum tax and digital taxation rules and participate in international talks under the OECD’s two-pillar global tax reform plan.

Vietnam’s proposed investment support fund created in response to its adoption of global minimum tax rules is necessary to ensure the country’s continued competitiveness and attractiveness to business, according to a top Vietnamese official.

Lucas de Lima Carvalho explains the importance of control in the taxation of controlled foreign corporations and reviews the ordinary meaning of the word and how it relates to its use in tax legislation.

Gary Clyde Hufbauer argues that low taxation of intellectual property sourced abroad provides a major, if hidden, tax incentive, and that taxing such income at a higher rate is a bad policy choice that will hinder future U.S. innovation.

The possibility that countries will interpret the highly complex global minimum tax rules differently and adopt inconsistent legislation raises concern amongst businesses. Disagreements between countries’ interpretation of the rules may lead to double-taxation problems for businesses. 

Nana Ama Sarfo discusses some expected tax transparency activity in 2024.

The OECD’s global minimum tax of 15% goes into effect this week in several dozen countries. Although the US and China are not part of the economies employing the global minimum tax, enactment in some of the world’s largest economies will raise vital proceeds for governments and end a “race to the bottom” on corporate tax.  

Martin A. Sullivan examines how the pillar 2 anti-base-erosion rules may affect incentives and how some of those detrimental effects could be mitigated.

Belgium is inheriting a heavy tax agenda as it takes over the EU Council presidency from Spain in the new year.

Enactment of the OECD’s global minimum tax only needs a critical mass of countries to implement it and result in an increase in annual tax revenue of 9%, while still creating favorable international tax competition in the form of tax credits, grants and subsidies.  

Colombian President Gustavo Petro calls for a tax reform proposal to lower the country’s high corporate tax rate, remove the VAT on tourism-related activities and create tax exemptions for clean energy. 

The missions given to EU Tax Commissioner Paolo Gentiloni when he took office have been fulfilled, but the European Commission still has some tax initiatives in the drawer for the closing months of its mandate.