2018

Sen. Marco Rubio (R., Fla.) is rolling out a new plan for business tax hikeswhile simultaneously acknowledging the recent success of business tax cuts. Even inwashington, aren't people supposed to learn from their mistakes? In 2017, Mr. Rubio held up passage of the historic reduction of the federal corporate income tax rate to 21% from 35% until his fellow Republicans agreed to expand "refunds" for peoplewho don't pay any federal income taxes.

Germany's burdensome tax system makes it the least attractive place for digital investment,while Italy has replaced Ireland as the most attractive, according to a study by professional-services firm PwC.

Recent proposals by countries to tax digital services don't go far enough, an Indian government official said, arguing that tax officials need broader tools to address how the internet has transformed the economy.

Indiawill continue pursuing digital taxes on foreign online companies unless they set up shop in the country, a government official said.

The amount of offshore cash U.S. corporations have returned home so far this year is just a fraction ofwhat President Donald Trump had promised.

Guidance thatwill likely come before Christmas could help companies figure out how they should dealwith previously taxed earnings and profitswhen calculating their U.S. taxes under the 2017 tax law.

The IRS is giving foreign-based bankswith U.S. operations some leewaywhen calculating a major new international tax aimed at preventing global companies from shifting profits abroad.

Procter & Gamble Co. and Canadian tax officials are optimistic about an OECD global pilot program that assesses multinationals' transfer pricing risks.

The Treasury Department may reconsider a measure in proposed debt interestwrite-off rules that denies a favorable election to some small or mid-sized multinationals. Lawmakers in the 2017 tax overhaul capped the amount of debt interest deductions corporations can take at 30% of adjusted taxable income, under amended tax code Section 163(j).

The U.S. House's revised lame-duck tax billwould provide relief to some multinationals and private equity firms facing additional taxes on offshore earnings because of the 2017 tax law. An apparent glitch in the law could subject certain U.S. taxpayers to tax on the offshore earnings of foreign entities even though those taxpayers don't control the entities generating the earnings.

A U.S. proposal could answer the digital tax questions vexing policymakersworldwide. The plan,which gives more tax revenue to the countrieswhere companies do business, could "satisfy a political need and obviate the need to take unilateral measures," such as the digital services taxes many countries are considering or have already enacted, said Brian Jenn, deputy international tax counsel at the Treasury Department.

The European Union plans to update its year-old blacklist of tax havens to include new criteria and an expanded geographic reachÔøΩpossibly all theway to the U.S.

France's government is said to beweighing a delay in a planned tax cut for large companies in 2019 as part of an effort to maintain the country's public deficit under the 3 percent ceiling imposed by the European Union after President Emmanuel Macron unveiled measures to appease Yellow Vests protesters.

The European Parliament voted overwhelmingly in favor of a temporary digital services tax aimed not only at large internet companies such as Google Inc. but also streaming services such as Netflix Inc., Spotify Technology S.A. and Apple Inc.

The U.K.'s largest corporations paid more taxes than last year, but their share of all tax collected continues to fall. The 100 largest companies paid 84.1 billion pounds ($106 billion) in tax in 2017-18, growing by 1.2 billion pounds year on year. But the share of tax these companies pay annually has dropped 1 percentage point over the past three years.

Online marketplaces including Amazon.com Inc. and eBay Inc.will be required to collect value-added taxes from foreign e-commerce markets selling goods into the European Union under new rules adopted by the European Commission.

The choice of Annegret Kramp-Karrenbauer to lead the ruling Christian Democrats means the same cautious and incremental tax-policy making characterizing Germany for more than a decade even as it faces competitive challenges from Anglo-Saxon tax reform and uncertainties resulting from the looming Brexit.

A surprise announcement from Brazil's revenue service creates the possibility of a 200 percent tax penalty, and the country's leading business association is scrambling to respond. The revenue service announced on Dec. 5 that itwon't accept monthly tax payments companies make after May 31 in relation to a measure that took effect in June that barred companies from using accumulated tax credits to pay income taxes on a monthly basis.

Global e-commerce giant eBaywarned that the costs of goods purchased online by New Zealand customerswould increase come Oct. 1, 2019,when online marketplaces like Amazon.com Inc. and Alibaba.comwould have to collect the country's goods and services tax if a government proposal takes effect.

A European Parliament committee voted to adopt a strict "economic substance test" that corporations must pass before moving from one EU member state to another.

India is bolstering its advance pricing agreement tax programwhichwas designed to reduce costly disputeswith multinationals after it came under criticism for being too burdensome.

The Australian Taxation Office (ATO) said large corporate groups underpaid their taxes by an estimated AUD 1.8 billion (approximately $1.3 billion) during fiscal 2015-2016, or 4.4 percent of the total amount owed.

AwTO appeals body has returned a split decision on rulings by a dispute resolution panel acting on complaints brought by the EU and Japan that some Brazilian tax programswere prohibited subsidies.

U.S. Treasury officials continue to assess the scope of their authority to help alleviate headaches associatedwith the increase in controlled foreign corporations under the Tax Cuts and Jobs Act (P.L. 115-97).

Although the proposed base erosion and antiabuse tax regulations take a taxpayer-favorable approach to the services cost method (SCM) exception, officials concluded that the statute doesn't support netting or a cost of goods sold (COGS) exception.

The first tranche of guidance on previously taxed income (PTI) since the enactment of the Tax Cuts and Jobs Act (P.L. 115-97) may need greater simplicity to prevent "hyper-complexity," a senior Treasury official said.

While the Tax Cuts and Jobs Act makes only a few revisions directly to subchapter K, it introduces many rules uniquely applicable to partnerships. Guidance in TCJA-related notices and proposed regulations clarifies how partnerships should apply these new provisions. The interest deduction limitation, gain on sales of partnership interests, and international provisions are just a few of the new TCJA rules that require special attention from partnerships.

Embattled French President Emmanuel Macron,whose approval rating is at 23 percent, has repealed the fuel tax hike that sparked the protests. Itwould have been about 30 cents on $7 per gallon ÔøΩ more than half ofwhich is tax already.

The IRS has issued proposed regulations (REG-132881-17) eliminatingwithholding on payments of gross proceeds and on some insurance premiums, deferringwithholding on foreign passthrough payments, and clarifying the definition of investment entity. The regs also provide guidance on some due diligence requirements ofwithholding agents and on refunds and credits of amountswithheld.

The European Parliament voted in plenary to support a broader digital services tax (DST) than the one proposed by the European Commission. The commission's proposal has failed to gain the support of EU finance ministers.

The OECD released a report on its second round of peer reviews examining countries' spontaneous exchange of tax rulings, finding that the review process has facilitated positive changes.

Countries remain uneasy overwhether businesseswill flee their markets given the United States' recent tax reforms.

Acknowledging that guidance is needed to better definewhat constitutes foreign use under the foreign-derived intangible income (FDII) provision, the IRS is contemplating presumptions to aid taxpayers.

Although total uniformity may be unrealistic, the eight countries participating in the Forum on Tax Administration's international compliance assurance program (ICAP) pilot are trying to develop common risk assessment standards for country-by-country reporting data.

The U.S. Treasury has indicated that the door may be open to revisiting its controversial net used tested loss amount rule under its guidance to the global intangible low-taxed income provision.

Some controversial aspects of the new proposed foreign tax credit regulationswere intended to reliably approximate economic reality in an administrableway rather than to prevent perceived abuse or avoidance.

Direct Energy has requested thewithdrawal or indefinite suspension of the section 385 recharacterization regulations (T.D 9790) to allow taxpayers to focus their resources on implementing the base erosion and inversion provisions of the Tax Cuts and Jobs Act (P.L. 115-97) and to reduce duplicative efforts, compliance cost and burden, complexity, uncertainty, and unintended consequences.

The Investment Industry Association of Canada has requested guidance for some financial institutions clarifying that as result of the repeal of section 958(b)(4) by the Tax Cuts and Jobs Act (P.L. 115-97), controlled foreign corporationswon't be considered U.S. payers for reporting and backupwithholding purposes andwon't be disqualified from the portfolio interest exemption because of their CFC status.

In this article, the author discusses Cameco, a long-awaited transfer pricing decision from the Tax Court of Canada that criticizes the Canada Revenue Agency's aggressive use of the sham doctrine and its strained interpretation of Canada's transfer pricing rules. The court opts to focus on the parties' actual actions and commercial realities, rather than advance a hypothetical alternative. The ruling is also consistentwith Canadian precedent,which takes a notably different approach to transfer pricing than the OECD.

In an address, Irish Finance Minister Paschal Donohoe discussed the current international tax environment and Ireland'sworkwith the OECD and U.S. government to attain a global solution for digital tax challenges, noting that "it is in everyone's interest that the ongoingwork results in an international tax framework that is sustainable into the long run."