2019

UK authorities are mounting a new crackdown on tax avoidance by multinational companies, inviting businesses they suspect of flouting the rules to come forward and settle their affairs.

Monaco joined 17 other jurisdictions that have ratified the Organization for Economic Cooperation and Development's ambitious super-tax treaty to crack down on corporate base erosion and profit-shifting.

Stock buyers in Europewould pay a transaction tax of at least 0.2 percent of the purchase price under a plan set out by Germany and France.

Austria's proposed 3 percent tax on online advertising revenue could net more companies than Google Inc. and Facebook Inc., tax practitionerswarn. Any company that operates in Austria, sells online advertisingwithin the countryÔøΩand has a global revenue of at least 750 million euros ($834 million) and domestic revenue of 10 million eurosÔøΩwill be subject to the tax, the government announced Jan. 10.

Austria plans to cut 4.5 billion euros ($5.2 billion) in taxes -- about 1.5 percent of economic output -- in the next three years as it tries to deliver on Chancellor Sebastian Kurz's campaign promiseswhile keeping the budget on track for a surplus. To balance against the cuts, Austriawill introduce a new 3 percent tax on Internet advertising revenuewith additional measures targeting global online giants like Alphabet Inc., Facebook Inc. and Amazon.com Inc.

Perrigo Co Plc. is considering shelving expansion plans in Ireland after tax authorities slapped the drugmakerwith a 1.6 billion euro ($1.8 billion) demand, a person familiarwith the matter said.

The European Commission estimates that the requirement for all member countries to vote for new tax laws has cost the single market 242 billion euros ($277.5 billion) in lost tax revenue, in a Jan. 14 proposal calling for the abolition of national veto powers in favor of a qualified majority.

The European Commissionwill invite EU governments to gradually relinquish their national vetoes on tax policy matters, according to draft of "communication" set to be unveiled on Tuesday and obtained by Bloomberg.

Germany should try to head off an economic slowdown by easing the tax burden on companies, according to the new chairwoman of Chancellor Angela Merkel's Christian Democrats. Germany's federal budget surpluswidened to more than 11 billion euros ($12.6 billion) last year, fueling debate about tax cutswithin the ruling coalition of Merkel's conservatives and the Social Democrats.

Indonesia's plan to tax e-commerce transactions is drawing resistance from the country's largest online retailers,which argue the levywill throttle the growth of a nascent industry that's drawn billions of dollars in foreign investment.

Steven Garden, Garywilcox, and Jeffrey Bruns of Mayer Brown discuss the proposed regulations intended to flesh out the interest deduction limitations under new tax code Section 163(j). The authors say the proposed regulations are thoughtful but long and complicated and include a very broad definition of interest.

More than a year after passage of the 2017 tax overhaul, multinational companies like Nike Inc. andwalgreens Boots Alliance, Inc. still aren't surewhat the new rules mean for their bottom linesÔøΩsetting up a bumpy ride through the upcoming earnings season. Companies are stillwaiting for the government to answer questions about the law's international provisions so they can calculate their tax bills properly.

The European Commissionwill launch the findings of a consultation into replacing veto powers on tax policywith a qualified majority voting system Jan. 15. The move could pave theway for the European Union to pass key tax laws such as the digital services tax and the financial transaction tax,which up to now have been stalled since the policy for tax measures requires unanimity from all member countries, and means some countries could block significant laws through exercising their right to veto.

Bermudian Finance Minister Curtis Dickinson issued the Economic Substance Regulations 2018 on December 28, aweek after the passage of the Economic Substance Act. The regulations took effect December 31.

Special counsel Robert Mueller is looking intowhether any foreign money illegally flowed to President Trump's inaugural committee. In August 2018 the U.S. District Court for the Southern District of New York obtained a guilty plea from awashington consultantwho used a U.S. citizen to purchase inauguration tickets so that a foreign person could attend the inauguration. Donations to an inaugural committee, including ticket purchases, can't come from foreign persons (see Rebecca Davis O'Brien, Rebecca Ballhaus, and Aruna Viswanatha, "Trump Inauguration Spending Under Criminal Investigation by Federal Prosecutors," Thewall Street Journal, Dec. 13, 2018).

The OECD is committed to finding reasonable solutions for addressing digital taxation this year. As previously reported, the organization has been considering a three-pronged approach involving a proposal for a minimum tax, favored by the Germans and the French; a proposal for a shift to destination-based source rules, favored by the United States; and a proposal for allocating taxing rights based on user location, favored by the United Kingdom.

In the realms of the beaten, there's the Red Devils, and there's service providers,which are looking at being beaten down by . . . BEAT. That'd be the new Tax Cuts and Jobs Act base erosion and antiabuse tax (section 59A). Proposed regulations interpreting this new lawwere issued on December 13 (REG-104259-18).

Chile isweighing proposals for a new tax of up to 19 percent on multinational digital commerce companieswith local operations Finance Minister Felipe Larrain said on Thursday, a rate nearly double that originally proposed.

This article discusseswhat the Sustainable Development Goals ("SDGs") are,what the role of (corporate) taxation is in reaching these goals andwhy both in-house tax practitioners and thoseworking in a law firm or advisory firm should pay close attention to the SDGs.

Alibaba has blocked 200,000 vendors globally since September in response to governmental pressure for the Chinese e-commerce giant to crack down on tax avoiders using its platform.

Mexicowill cut the tax rate paid by companies on the proceeds of initial public offerings to 10 percent as part of a broad-ranging plan to boost public offerings and spur growth in the financial system.

Amazon, Facebook, and other American technology giants could owe Italy hundreds of thousands of dollars under a new digital-revenue tax lawmakers approved as part of the country's 2019 budget.

The U.K. tax office is giving companies a chance to avoid a 30 percent penalty if they disclose their exposure to the "Google" tax through a new notification program.

Brussels has launched a probe intowhether Nike benefited from sweetheart tax arrangements in the Netherlands that breached EU curbs on state support.

Nike Inc. is the latest U.S. giant to become embroiled in the European Union's crackdown on tax deals regulators say give a select group of big firms an unfair edge over their rivals.

Money collected from the U.S. government's new import tariffs helped offset the loss of revenue it suffered from corporate tax reductions, according to estimates published Jan. 8 by the Congressional Budget Office.

The American Institute of CPAs has addressed issues in proposed regulations (REG-104390-18) on global intangible low-taxed income that include the carryforward of net tested losses by U.S. shareholders, anti-abuse rules, and the availability of the section 245A dividends received deduction to controlled foreign corporations.

The Organization for Economic Cooperation and Development held a meetingwith the Netherlands that focused on international cooperationwithin the tax field and the adoption of measures by the Dutch government to update the international tax system and address tax evasion.

In this article, the author examines the relationship between Greece's general antiavoidance rule and the GAAR included in the EU's anti-tax-avoidance directive.

Thailand has implemented a new international business center (IBC) tax regime in linewith action 5 (harmful tax practices) of the OECD's base erosion and profit-shifting project.

Recently released guidance on the base erosion and antiabuse tax may have provided taxpayerswith much-needed detail, but practitioners are not fully satisfiedwith answers provided on base erosion payment operating rules.

On January 15 the European Commissionwill present a communication setting out options to move from unanimity to qualified majority voting in tax matters.

The European Commission has launched a state aid investigation into tax rulings granted to U.S. footwear giant Nike that approvedwhat may have been excessive royalty payments to group intellectual property holding companies.

The GOP corporate tax reform,which cut the U.S. rate to 21% from 35% and allowed businesses to repatriate overseas profits tax-free, has given U.S. drug makers more cash to invest. Now they're acquiring companies to advance innovation rather than engage in tax arbitrage as they did pre-reform.

Americans are used to debating the impact of tax policy on economic growth, so it might come as a surprise (or not) that the European Union is far behind the curve in this regard. New research helping Brussels fill that gap is a breath of fresh air. At issue is dynamic scoring, a method economists use to estimate how tax-policy changes affect economic growth, employment and revenue. Dynamic-scoring projections have featured prominently in U.S. debates for years. Yet EU economists cling to static scoring, a less realistic method that assumes tax policy has no bearing on broader economic incentives. This leads them to overstate lost revenue from tax cuts and overestimate the revenue gains from tax increases.

The Spanish goodwill cases could give the European Commission more room for maneuver in state aid investigations and could have consequences on pending and future fiscal state aid cases.

Hungary has traditionally maintained a very favorable corporate income tax environment for decades, making it a competitive option for international holding structures. Changes in the corporate tax environment in Hungary in 2019will provide further opportunities for international holding structures.

Google Inc. continued to reduce its taxes for another year by taking advantage of loophole structuresÔøΩthis time shifting $22.6 billion.

A U.K. finance bill amendment passed Tuesdaywould limit the government's ability to tweak tax legislation after Brexit, in a bid to discourage the government from leaving the European Unionwithout a transitional trade agreement. The amendment, approved by 303 votes to 296 in the House of Commons,would mean the government cannot make technical changes to maintain the effect of the tax code should the country leave the European Unionwithout a deal in two months' time unless lawmakers have given their express consent to a so-called no-deal Brexit.

Democrats in the coming yearwill be laying the groundwork to eventually roll back parts of President Trump's tax law. No Democratic lawmakers voted for the measure Trump signed in December 2017, criticizing the bill for providing large benefits towealthy individuals and corporations and for adding to the federal deficit.with Republicans controlling the Senate and thewhite House, Democrats are unlikely to be able to undo any significant portion of the law in the next two years.

This could be the year Congress tries to enact the mother of all taxes, a carbon taxÔøΩa levy on the use of oil, natural gas and coal. Everything that is fabricated, grown, operated or moved is made possible by hydrocarbons. That makes the carbon tax different from a mere consumption or excise tax. The latter is attached to purchasingÔøΩspend more, pay more. A carbon tax is a tax on existence, because all aspects of living require energy, and hydrocarbons provide 80% of America's energy, more for the rest of theworld. And hydrocarbons are used to create or build everything else that produces energy.

Isle of Man's parliament recently approved new corporate substance requirements in linewith the recommendations of the EU Code of Conduct Group on Business Taxation.

The Netherlands' decision to place the Cayman Islands on its tax haven blacklist has brought a backlash of criticism from the British overseas territory.

Although Amazon sympathizeswith governments impatient for an OECD solution to tax the digital economy sooner than 2020, a revenue-based digital taxwould unfairly hit companies like Amazonwith razor-thin margins, a company executive said.

On December 28, 2018, the Dutch Government published in the Official Gazette a list of 21 low-tax jurisdictions. Companies doing business in these territorieswill face new anti-avoidance measures, intended to tackle tax base erosion and profit shifting. Jurisdictions on the list have a corporate tax rate of less than nine percent.