2017

Swiss bank Credit Suisse Group AG said that it expects towrite-down 2.3 billion francs ($2.3 billion) intax-deferred assets this quarter as a result of the signing of a sweeping U.S.taxoverhaul. Thewrite-down is a one-time accounting adjustment and has minimal impact on the bank's strong regulatory capital position, the bank says.

Both Shell and Barclays said thatwhile theywere likely to benefit over time from the reduction in the US corporate tax rate from 35 percent to 21 percent, they expected to take hefty non-cash charges in their fourth-quarter results. Shell expects to take a $2bn-$2.5bn charge against the accounting value of its "deferred tax assets" in response to a sweeping overhaul of the US tax system thatwas signed into law by Mr. Trump. Barclays said it expected to record a £1bn charge in its 2017 results.

Goldman Sachs haswarned that itwill take a $5bn hit to fourth-quarter profits as a result of president Donald Trump's tax overhaul, mostly because of a new levy on overseas earnings.

In this paper, the authors analyze the cross-border effects of patent box regimes that reduce the tax rate on income from intellectual property. The authors argue that the tax cut in one location of a multinational enterprise may reduce the user cost of capital for thewhole group if profit shifting is possible. This spillover effect of the foreign tax cut raises domestic R&D investment.

Over 2,600 bilateral relationships for the exchange of common reporting standard information have been established, the OECD said in a December 21 release, adding that 39 of the 53 jurisdictions committed to first exchanges in 2018 have implemented the international legal requirements.

Corporate finance teams are scrambling to save even more on taxes before the Republicans' big cut goes into effect. Companies are scoping out last-minute opportunities to maximize those deductions before the new system takes effect, accountants said.

President Donald Trump and congressional Republicans are betting their tax overhaulwill jolt the economy after a long but slow expansion. A sharp cut in the corporate-tax rate is meant to spur business investment and hiring. A rewrite of tax laws covering international profits is meant to bring corporate funds home. Lower individual rates are meant to give households more money to spend or bolster their finances. Still, the case for sustained faster growth is murkywhen looked at through the lens of history, and no sure thing now.

EU-member nations Dec. 20 backed laws to crack down on tax evasion and money laundering that include new transparency rules to prevent individuals and companies from setting up shell companies to hidewealth. The revisions to the EU Anti-Money Laundering Directivewill require EU countries to set up public registries listing individualswith a share of 25 percent or more of a company.

The European Union's tax chief is optimistic that structural reform of the bloc's tax systemÔøΩthrough a common consolidated corporate tax base (CCCTB)ÔøΩis possible, but admits that "it depends" on governments such as Ireland.Ireland,with its 12.5 percent corporate tax rateÔøΩamong the lowest in the blocÔøΩis expected to be less inclined to agree to a CCCTB.

Is the real lesson from tax reform that Americans rely too much on the income tax to fund their government? Time and again, that box has proven too small a revenue pot to do all that it's asked by taxwriters. And this leads to decisions, howeverwell-intentioned, that contribute to distortions down the road. Most other industrial nations lighten the load on their income tax by combining itwith some form of consumption taxes ÔøΩ a hard sell in today'swashington. But given the partisan carnage of this latest tax fight, the uncertain result, and very real debt crisis facing the nation, is it time for both parties to start looking at other options?

The European Commission has approved an Irish tax incentive for employee share schemes offered by SMEs – the Key Employee Engagement Programme (KEEP).

Australia's Finance Minister has said that company tax cuts are now "even more urgent" and that itwould be "absolutely reckless and irresponsible" for the opposition to continue to block reform legislation.

Indiawill trial a new system thatwill enable goods to be sent to other Indian stateswithout border checks under the country's new goods and services tax (GST) regime from February 2018.

One potential boost for the U.S. currency could come if corporations bring home cash held overseas. Under the Republican tax plan, U.S. corporationswill pay a one-timetaxof up to 15.5% on the profits they have stockpiled abroad,which could boost demand for the dollar as companies buy the currency to meet the levy and return assets to the U.S.

The U.K. government haswon a court bid to claim up to 1.2 billion pounds ($1.6 billion) in taxes linked to the collapse of Lehman Brothers Holdings Inc. in 2008, leaving the bank's creditors in line for a smaller slice of its remaining funds than they'd expected.

Singaporewill not tax funds that are coming in from foreign countries, in some cases, even if those countries do not first levy a dividend tax on the funds, according to a notice on the city-state's tax agency.

The Australian Tax Office released two key guidance documents Dec. 18 on laws affecting multinational companies and their cross-border transactions.

Amazon.com Inc.will pay 100 million euros ($118 million) to the Italian tax authorities for the period of 2011-2015 in a settlement that closes the fiscal probe by the country's tax police. Amazon confirmed in a separate statement that it reached an agreement and its local branch now has all revenues, expenses and taxes accounted for in Italy.

The IRS has requested comments on Form 8858, "Information Return of U.S. Personswith Respect to Foreign Disregarded Entities," and its related Schedule M; comments are due by February 20, 2018.

The OECD has issued peer review reports that evaluate how Austria, France, Germany, Italy, Liechtenstein, Luxembourg, and Sweden are implementing minimum standards on resolving tax treaty-related disputes in accordancewith action 14 of the base erosion and profit-shifting project. The OECD peer reviewswere available atgoo.gl/HbV3QN as of December 15, 2017.

EU member nations and the European Parliamentwill use the second phase of Brexit negotiations, due to begin in 2018, to ensure the U.K. adheres to tax policies that don't distort single market competition. At the same time, member nations and Parliament are expected to exert Brexit pressure to regulate Gibraltar and crack down on U.K. overseas territories and crown dependencies, according to EU officials.

U.K. government officials are "aware" some multinational companies are struggling to use a recently launched e-portal as they submit their first global tax reports.

Italy's lower house has approved an amendment to the government's 2018 budget bill that establishes a 3 percent tax on some internet transactions, down from the initial 6 percent.

U.S. multinationals need immediate guidance on how to treat the offshore cash theywill have to bring back under a pending tax reform measureÔøΩand how to address a sweeping set of complex issues, according to practitioners.

The Internal Revenue Service proposed new tax rules for foreign currency gains and losses, covering such issues as accounting methods and exclusions. Taxpayerswould be able to use the mark-to-market method of accounting for these gains and losses under the new rules, released Dec. 18.

Despite the increasing possibility that the United Stateswill slash its corporate tax rates and concern that itwould be followed by copycat moves by other countries hoping to remain competitive, Hong Kong's financial secretary said December 10 that the government of Hong Kong has no plans to follow suit.

Brussels has launched a probe into the Ikea brand's tax arrangements as the EUwidens the net in its four-year crackdown on aggressivecorporate tax avoidance.

The final version of the Republican tax planwould end some of the tax advantages companieswith operations in Puerto Rico have long enjoyed, potentially delivering an economic blow to the territory still reeling from Hurricane Maria and a record setting bankruptcy, according to an expertwho reviewed the plan Dec. 15.

The OECDwill "establish a clear sense of direction" for its policy on the taxation of the digitized economy in its April report to the Group of 20 finance ministers, an official said on Dec. 15.

An 18-month global pilot program designed to prevent cross-border tax disputesÔøΩinwhich the U.S. is participatingÔøΩwill be "a game changer" for tax administration audits of multinational enterprises, according to OECD's tax chief.

Chile could be facing its fifth tax reform in less than a decade after billionaire businessman Sebastian Pinerawon an overwhelming victory in the final round of voting in the country's presidential elections on Dec. 17.

Congress is abandoning the separate limitation on deductibility of interest for multinationals in its tax reform bill, just one of the international developments from a conference committee report that includes a substantial endorsement of several Senate provisions related to anti-base-erosion and mobile income.

Japan's ruling parties have approved a tax reform package for fiscal 2018 that includes a corporate tax break for companies that increasewages, in a bid to stimulate greater economic productivity.The Liberal Democratic Party and Komeito, its junior coalition partner, released the much-anticipated tax reform package December 14, shortly after Japan's Cabinet approved a broader economic policy package December 8,which included a corporate tax proposal tied to productivity.

The Tax Court, granting the Coca-Cola Co. partial summary judgment in a transfer pricing disputewith the IRS, held that the companywas entitled to claim foreign tax credits for taxes paid to Mexico by a Mexican licensee, finding that the taxeswere compulsory levies and creditable under section 901.The IRS made adjustments under section 482 to Coca-Cola's returns for the 2007-2009 tax years. According to the IRS, Coca-Cola's Mexican licensee, a branch of a Coca-Cola subsidiary and member of Coca-Cola's affiliated group, paid royalties to Coca-Cola thatwere not calculated at arm's length. As a result, the IRS determined that the Mexican licensee claimed insufficient deductions for royalties and overpaid taxes to Mexico. The IRS further determined that the overpaymentswere not compulsory andwere not taxes under section 901, making Coca-Cola ineligible to claim foreign tax credits for the overpayments on its federal tax return.

The EU court has rejected the US government's request to join Apple's appeal of Brussels' order that it pay ÔøΩ13 billion in back taxes.

Luxembourg has appealed against an EU decision to make Amazon pay ÔøΩ250m more tax in Europe, making it the latest member state to push back against the Brussels' crackdown on avoidance by big multinational companies.

The anticipated changes to New Zealand's tax regime for cross-border relationships and transactions are fast becoming a reality. All New Zealand businesses that operate overseas, and all business groups based overseas that operate in New Zealand, are likely to be affected in someway by the new rules.It is critical for all businesses operating in New Zealand to consider carefully the potential cumulative effect that the proposed ruleswould have, and to do this as soon as possible given the short lead time.

US value added of US MNCs grew faster than value added in their foreign affiliates over the 2014-2015 and the 2009-2014 periods, reversing the trend for the prior 15 years.

This paper considers the effects of US Tax Reform on Europe,with a focus on Germany, from perspective of tax competition, FDI, and possible responses.

Wall Street is fighting to limit the scope of a provision meant to discourage companies from sending money overseas to avoidtaxes. The Senate's tax bill adds a special tax on overseas bank transactions, including repo and intercompany payments. Foreign banks, too, say thetaxprovisionwill make their U.S. operations more expensive and reduce their ability to lend in the U.S.

An executive order directing federal agencies to eliminate two regulations for every new one they issue could complicate the IRS's task of implementing tax reform legislation, practitioners said.

Donald Trump says U.S. tax cutswill fuel a growth miracle. As the Federal Reserve gave its first formal response to the Republican reforms onwednesday, itwas clear the central bank foresees a far more modest impact.

The Netherlands' dividendwithholding tax is a millstone around the neck of the mostly foreign investorswho prop up the country's major corporations, chief executives from Shell and Unilever have told lawmakers. The corporate executives pointed to the lack of domestic capital as a key reasonwhy the country's 15 percent tax on dividend distributions is a major burden on resident multinational corporations.

The U.K.will reconsider the case for making multinational companies' global tax reports public, a decision thatwould make the country the first to take the step. In its Dec. 14 departmental report for 2018, the U.K.'s tax authoritysaiditwill review international rules for the global tax reports and "consider the case" for making them publicly available.

Israeli finance officials are closely following the progress of the U.S. tax reform bill, as practitionerswarn that the loss of Israel's tax advantage could reduce its attraction for high-tech startups.

The IRS on December 13 announced that France and the United States have signed a joint statement providing for the spontaneous exchange of country-by-country reports for fiscal years beginning in 2016.

A taxbill to counter tax avoidanceby multinational companieswas introduced into New Zealand's Parliament.The government also released its commentary on the bill, prepared by Stuart Nash, New Zealand's Minister of Revenue.

The US Senate voted 51 to 49 to pass an historic tax reform bill on December 2 that is expected to impact Mexico from both a tax and economic perspective.

European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici speaks to International Tax Review about the EU's blacklist of tax havens, the struggle to tackle tax avoidance and how to tax the digital economy.

The French Parliament has passed the 2018 finance bill,which includes a controversial 5 to 10 percent surtax on large corporations thatwas added to cover the financial shortfall createdwhen the Constitutional Council declared France's tax on dividend distributions unconstitutional. The Senate passed the bill by a vote of 128 to 122 on December 12. The National Assembly passed the bill earlier in the day by a vote of 323 to 163,with 32 abstentions.