2019

A U.K. court has held that domestic legislation imposing immediate corporate tax liability for capital gains on intragroup stock transfers is a disproportionate measure that violates the EU right to freedom of establishment.

Carrie Brandon Elliot reviews several of the latest blockchain projects and how they affect the economy, illustrating how decentralization, anonymity, and massive transaction volumes may render the OECD's two pillars obsolete in the near future.

Mindy Herzfeld describes proposals to revise global tax rules to allocate a greater share of multinational companies' profits to market jurisdictions, including several presented during the OECD's recent consultation on the tax challenges of digitization.

Lee A. Sheppard examines the proposed regs to implement the hybrid mismatch rules thatwere included in the Tax Cuts and Jobs Act.

Stephenwang is counting the costs of President Donald Trump's tradewar. He had to put down 12 times more cash as a guarantee to U.S. customs that hewould pay the bill for tariffs on the Chinese-made pumps, valves and motors he imports. The cost of the guarantee - a U.S. customs bond - has shot up, an additional hit to importers already facing steep customs bills adding up to tens of billions of dollars for tariffs imposed by the Trump administration on incoming Chinese goods, aswell as steel and aluminum imports.

Stephenwang is counting the costs of President Donald Trump's tradewar. He had to put down 12 times more cash as a guarantee to U.S. customs that hewould pay the bill for tariffs on the Chinese-made pumps, valves and motors he imports. The cost of the guarantee - a U.S. customs bond - has shot up, an additional hit to importers already facing steep customs bills adding up to tens of billions of dollars for tariffs imposed by the Trump administration on incoming Chinese goods, aswell as steel and aluminum imports.

The U.S. economy slowed more than initially thought in the fourth quarter, keeping growth in 2018 below the Trump administration's 3 percent target, and corporate profits fell by the most in a year after a one-off boost from lower taxes.

As the international push to discourage tax avoidance and secrecywages on, many countries that formerly marketed themselves as tax havens are now looking to become hubs of blockchain, the online ledger system used to record cryptocurrencies ÔøΩ and much more.

While the European Union and Britainwrestle over the "Irish backstop" issue in their stalled Brexit agreement, a similar problem is taxing another island at the other end of the continent - Cyprus.

U.S. companies more than quadrupled the amount of foreign earnings they sent home in 2018 following enactment of a tax-law overhaul in late 2017, though the size of so-called repatriations declined after an initial spike.

PwC submitted, on behalf of a group of companies, a comment letter on February 19, 2019,which addresses an issue arising from the interaction of Section 267(a)(3)(B)with the TCJArepeal ofSection 958(b)(4).

British businesses havewelcomed confirmation from the UK Government that Making Tax Digitalwill not be rolled out to other taxes and more businesses in 2020.

As Congress opens discussions on how best to address climate change, some opponents of these efforts are positioning the Green New Deal and carbon taxes as conflicting strategies. This should not be the case. Congress should consider this an opportunity to demonstrate that the most efficient approach to addressing climate changewould incorporate both strategies.

When Republicans rewrote the international tax system in 2017, theywere trying to help U.S. companies like Procter & Gamble Co. compete in foreign markets and create domestic jobs. Fifteen months later, the Ohio-based consumer products maker and other U.S.-based multinationalswarn the new law could instead put them at a disadvantage globally and reduce their incentive to invest at home.

The current mantra from opponents of the 2017 Tax Cuts and Jobs Act is that the strong economic growth that followed is the result of a "sugar high." Many nowwrongly argue the U.S. is headed for a sharp economic slowdown, possibly even recession. These arguments reflect political and ideologicalwishful thinking, not a substantive analysis ofwhat is happening in the economy.

The American Institute of CPAs has recommended changes to proposed foreign tax credit regulations (REG-105600-18) on topics that include the determination of stock basis in connectionwith section 965(b)(1), the allocation and apportionment of research and experimentation expenses, and characterizing stock of a noncontrolled 10 percent corporation.

In the "Fiscal Policy for Financing Sustainable Development in Africa" report issued on March 26, the UN Economic Commission for Africa called for a refrain from unproductive tax incentives and a reform of the tax system administration through digitalization.

Germany's federal and state governments have decided to drop a controversial plan to apply a 15 percentwithholding tax on royalties to payments for online advertising made to foreign internet companies, including Google and Facebook.

Defense contractors may have caught a big breakwith their eligibility for foreign-derived intangible income under proposed regs, but not all arms sales that ultimately go to foreign governmentswill benefit from the deduction.

In this article, the authors discuss how taxpayers and tax authorities alike can use impact evaluation to examine the effects of cooperative compliance programs. More specifically, they consider how to design an impact evaluation that can thoroughly assess the outcomes of the International Compliance Assurance Program, a new project that the OECD hopeswill provide early certainty, offer assurances regarding tax obligations, and promote the efficient use of resources by both tax administrations and taxpayers.

In a Tax Court petition contesting $219 million in transfer pricing adjustments, Zimmer Biomet Holdings alleges that the IRS violated the Administrative Procedure Act (APA)with its former regulations on outbound intangible transfers in corporate reorganizations.

The heads of some 50 tax administrations are moving to phase two of an experimental multilateral tax risk assessment program ÔøΩ this timewith 17 countries ÔøΩ as part of their ongoingwork to enhance tax certainty.

In this article, the author discusses the Court of Justice of the European Union's judgment in A-Brauerei ÔøΩ holding that an exemption from Germany's real estate transfer tax should not be considered state aid ÔøΩ and looks at the expected impact of the ruling.

The EU has claimed a "final victory" in a long-running disputewith the United States, saying awTO appellate body ruled that Boeing has continued to receive illegal tax subsidies despite earlier rulings banning them.

Tax administrations have proposed approaches to ensure the taxation of the sharing and gig economy, including developing a model allowing platforms to report seller details in a standardizedway.

The Council of the European Union has issued a conclusion, endorsing the revised non-cooperative jurisdictions blacklist and praising those jurisdictions that have resolved deficiencies in anti-money laundering and terrorist financing by the agreed deadline.

A U.S. subsidiary of a global satellite operator has sued the IRS in Tax Court, alleging that the agency erred in determining that three of its controlled foreign corporations guaranteed notesworth $1 billion.

Facedwith twice as many advance pricing agreement applications and reduced staffing compared to 2017, the IRS advance pricing and mutual agreement program reported a six-month rise in the median application processing time for 2018.

Successive U.K. governments have failed to rein in tax avoidance by digital behemoths like Google and Amazon.com, so Britain should target use of Ireland as a tax haven enabling that practice, a U.K. tax advocacy group said Thursday.

The Internal Revenue Service's Large Business and International Division issued a practice unit Friday for training agency personnel about U.S. multinational companies' ability to get agency helpwhen a foreign government initiates an income tax adjustment.

Christine Lagarde, International Monetary Fund managing director, in a March 25 speech called for reforms to the current international corporate tax system so that "all countries can benefit, including low-income nations."

Despite the complexity inherent in designing a global residual profit allocation system of the type recently proposed by the OECD, the U.S. global intangible low-taxed income rules suggest that the challenges are not insurmountable.

Robert Goulder examines the use of knowledge-sharing programs among national revenue bodies, as exemplified by the group Tax Inspectorswithout Borders.

Several provisions in the base erosion and antiabuse tax guidance are being criticized as running contrary to statutory language or intent, including the non-exclusion of subpart F inclusions and the application of a blended rate.

Representative Lloyd Doggett and Senator Sheldonwhitehouse are introducing two bills March 13 thatwould effectively repeal some provisions of the Republican tax overhaul of 2017 that the Democrats say encourage outsourcing.

Although the recent Tax Reform Law is not the structural tax reform the Colombian tax system has been demanding for several years, it introduces important measures regarding value-added tax, income tax, dividends, and indirect sale of assets. In addition, it creates a new Colombian Holding Company regime to incentivize multinational groups carrying out certain investment activities to establish their headquarters in Colombia.

Indian clothing suppliers to American and European brands say new tax incentiveswill help them lower prices and reclaim ground they've lost to competitors elsewhere in Asia. A new program to make textile exports effectively tax free comes as buyers in places like the U.S. are looking to diversify their supply chains after years of relying heavily on countries like China, said Sanjay Arora ofwazir Advisors, a textile industry consultancy.

The U.K. government believes that some profits fromwork carried out in the U.K. by U.K. traders, professionals and companies are partly being allocated to entities or individuals in overseas territorieswhere no tax, or a lower rate of tax is paid, hence partially or fully avoiding U.K. tax. The U.K. tax authority is addressing the issue of fragmented profits by bringing the profits accruing to U.K. traders, professionals and companies into the U.K. tax charge.

Italy has introduced tax measures to support companies in their digital transformation, looking specifically at how blockchain, artificial intelligence and the internet of thingswill have a significant impact on the future business model of Italian businesses.

"An impetus for rethinking international corporate taxation stems from the rise of highly profitable, technology-driven, digital-heavy business models," International Monetary Fund Managing Director Christine Lagarde said March 25 in prepared opening remarks for an event inwashington.

France and the U.K. are edging closer to establishing a system to tax tech giants like Amazon.com Inc. and Alphabet Inc.'s Google, even as the OECD tries to reach global consensus on its efforts to rewrite international tax rules. The uptick in digital tax proposals,which most jurisdictions indicate are temporary measures, makes it clearwhat's at stake if efforts to find a global consensus at the OECD fail, tax practitionerswarned.

The 2017 tax overhaul reformed international tax rules in the U.S., including requiring companies to bring home offshore profits. Nearly a year and a half later, companies are stillwaiting for final guidance from the Treasury Department on many of those international rules. If the government finalizes rules by June 22, 2019, theywill be retroactively effective to the date of the law's passage. But if not, there could be a period of time inwhich the regulationswouldn't be effective. Here'swhere the international rules stand now.

The OECD released recommendations on how digital tech giants can aid in the international effort to crack down on value-added tax fraud.

Rahul Mitra of Dhruva Advisors LLP in New Delhi discusses the transfer pricing issues surrounding "marketing intangibles," following the OECD's release of revised guidelines.

In news analysis, Lee A. Sheppard describes how the Tax Cuts and Jobs Act limits the reach of the foreign tax credit.

Although intended as a means of increasing foreign digital companies' tax contributions, a digital services tax may be borne almost entirely by local consumers and businesses in the form of higher prices and commissions.

Whether they're streaming a movie on Netflix or buying a music album on iTunes, consumers are at risk of paying multiple taxes on the digital goods and services they buy. That's simply unfair, and Congress should do something about it. Suppose a resident of Nevada purchases a smartphone appwhile vacationing in Maine. The vendor's server happens to be located in Virginia. Currently, as a result of outdated lawswrittenwith brick and mortar stores in mind, there is nothing to prevent any and all of those states from levying a tax on that transaction, tripling the tax burden on the consumer.

France plans to make significant progresswith members of the G7 group of countries to reach an agreement on a minimum corporate tax rate after the OECD has presented itswork on taxing the digital economy to the G20 in June.