Int'l Tax News

Belgian members of Parliament on June 2will discuss a new proposal to introduce a digital tax at the national level.

In economic analysis, Martin A. Sullivan examines refunds for losses, especially in light of the coronavirus pandemic.

Mindy Herzfeld describes changes in perceptions of corporate taxes and the concept of a corporation that could result from the coronavirus pandemic.

Carrie Elliot reviews the new rules for computing deemed paid foreign taxes on income contributing to subpart F or global intangible low-taxed income inclusions.

The U.S. Trade Representative's Office announced Tuesday itwas imitating investigations into India and other countries, aswell as the European Union, that have enacted or are considering special taxes on digital services.

The US has announced that itwill begin an investigation into digital services taxes (DSTs) that have been adopted or are being considered, alluding to a more aggressive response to unilateral action.

Special taxes on digital companies seem almost inevitable as the novel pandemic heightens focus on the tech sector, but they could face legal challenges under both international trade and tax rules as countries begin to collect.

The novel coronavirus pandemic has some members of Congress discussing tax policies that could entice multinationals to bring manufacturing home, but those measures, including a slash in the corporate rate, may not make much difference in the current uncertain climate.

Tax directors intend to revise force majeure clauses in advanced pricing agreements (APAs) and inter-company contracts after finding limited certainty on deferring certain contractual obligations and maintaining agreements under the clause amid the pandemic.

The European Commission (EC) has proposed a recovery plan for the EU to tackle COVID-19 through a fundworth ÔøΩ750 billion ($825 billion),which could be paid for by new taxes.

The United States and the EU should begin talks about a proposed carbon border tax soon to avert a potential tradewar, a new report from theAtlantic Councilwarns.

If countries fail to reach a deal on global minimum corporate taxation this year, theEuropean Commissionwill propose its own plan by next year, EU Tax CommissionerPaolo Gentilonisaid.

Brazil'sHouse of Representativesis considering legislation to subject awide range of digital activities to progressive taxation. The proposal faces an uncertain future in theNational Congressand possible opposition by the United States.

TheAustralian Taxation Officesaid itwill be closely scrutinizing tax structures used by nonresidents to invest in domestic businesses ÔøΩ particularly their characterization of income and the form of their investment interests.

In this article, the author proposes a framework for developing administrableOECDpillar 1 rules that promote a consensus solution to the taxation of the digital economy by addressing the risk of uncertainty for taxpayers.

A German employee's home office in Denmark constitutes a taxable permanent establishment, the Danish Tax Board has ruled, clearing theway for taxation of the German employer.

If there is no globally agreed solution to tax the digital economy, then dozens of debt-laden countrieswill move unilaterally, raising the risk of tradewars during the coronavirus pandemic, theOECD's chiefwarned.

In this article, the authors discuss Mexico's new regime for taxing digital services that takes effect June 1, including the obligations it places on both resident and nonresident digital platforms and digital intermediaries that provide services to residents of Mexico.

In this article, the author discusses how theOECDandG-20digital tax reformswould affect marketplaces, especially marketplaceswith China-related inbound and outbound investments.

Two associations representing telecommunications and mobile network operators said European countries'plans to introduce unilateral digital services taxeswill increase double taxation disputes and result in more complexity.

Increased tensions between President Trump and China over the coronavirus pandemic are threatening to complicate a recovery from theworst global economic downturn in decades.

The coronavirus downturn in trade has taken "some of the teeth" out of the U.S. threat to impose sanctions on countries that enact a digital services tax, a top official for the Organization for Economic Cooperation and Development said Thursday.

China plans new tax cutsworth $4.5 trillion yuan ($631 billion)while forgoing economic growth forecasts, the country's No. 2-ranking official said in a key policy speech Friday that touted measures to rescuer the country's economy from the COVID-19 pandemic.

Indonesiawill hit foreign companies' sales of digital products and services in the countrywith a 10% value-added tax starting July 1 to help pay costs of the COVID-19 pandemic, the government said.

Robert Goulder examines the CJEU's recent decision upholding the validity of Italy's financial transaction tax.

More than half of voters in Great Britainwould support an excess profits tax on companies realizing profits "significantly above their normal levels" during the coronavirus pandemic, according to a YouGov survey.

The expected spike in the number of multinationals that report losses in thewake of the COVID-19 pandemic may seriously disrupt an international transfer pricing regime thatwas designed primarily for the allocation of profit.

Contrary to media reports, France hasn't changed its plans to suspend digital services tax collection in 2020 and still supports OECD-level negotiations on a common approach to modernizing international tax rules for the digital age.

Mindy Herzfeld discusses the U.S. role ÔøΩ or lack thereof ÔøΩ in the OECD project to address digital taxation,which she says lacks a reasonable deadline and reliable data.

Businesses that manufacture products internationally could face new taxes in an effort byPresident Trumpto bring more production to the United States.

Organization for Economic Cooperation and Development Secretary-General Angel Gurría onwednesdaywarned that the debt countries and companies take on toweather the coronavirus pandemicwould be a drag on economies in the future.The debt, he said,would "come back to haunt us," according to the Financial Times,which hosted the online conferencewhere Gurría made the remarks.

The U.K. should base relief given to companies during the coronavirus pandemic on good behavior, denying funds and tax breaks to those doing business in tax havens, a cross-party group of legislators said in a letter released. The letter, dated Thursday, asked Rishi Sunak, the chancellor of the Exchequer, to place conditions on big businesses receiving state aid, such as not being registered in a tax haven, imposing a moratorium on dividends and share buybacks, and curbing excessive executive pay

Multinational companieswould be unduly burdened if the Organization for Economic Cooperation and Development expands its requirement for how they report jurisdiction-specific data about tax activities, several corporate executives saidwednesday.

The UK government is set to increase taxes as part of its plans to finance the emergency COVID-19 spending, signalling that even business-friendly jurisdictionswill be leftwith no other choices to strengthen budgets.

The OECD's May 12-13 meeting on country-by-country reporting (CbCR) saw businesses and campaign groups find some agreement on the limits of aggregate data compared to consolidated data.

Just because a non-EU company has a subsidiary in a member state does not mean the company has a permanent establishment in the EU, theCourt of Justice of the European Unionheld.

In this article, the authors examine the implementation of Germany's license barrier rule and the guidance that theGerman Ministry of Financerecently provided regarding the compliance of preferential tax regimeswith the nexus rule.

In this article, the authors examine how tax advisers can structure cash pools such that intercompany interest rates are best positioned towithstand review based on theOECD's new transfer pricing guidance on financial transactions.

Developing countries are seeking an international legal instrument that dealswith tax avoidance and data transparency in a neutral and fairway,whichwould include giving them an equal voice in global digital tax initiatives.

The U.K. governmentwon't agree to theOECD's publication of aggregated country-by-country reporting data under action 13 of the base erosion and profit-shifting project unless "data quality and consistency issues" are addressed.

Nearly 140 countries thatwere planning to meet in July to try reaching political consensus on a proposed global corporate tax overhaulwill now meet in early October because of the coronavirus crisis.

In this article, the authors consider proposals to rebuild revenue coffers using excess profits taxes during the COVID-19 pandemic and argue that, owing to emerging global tax data, norms, and governance structures, a global excess profits tax has better prospects than a series of unilateral measures.

The U.S. income tax ÔøΩ like all others ÔøΩ is supposed to allow for an offset of economic losses against gains so that taxpayers are taxed only on their net income. For the same reason, expenses incurred in generating revenue are supposed to reduce gross income in calculating net income.But it doesn't alwayswork thatway in the case of foreign income includible in the US tax base, and the CARES Act didn't help matters.

In this article, the author discusses theCourt of Justice of the European Union's recentTescoandVodafonejudgments and their implications for potential challenges to European digital taxes.

As part of a coronavirus mitigation package, Hungarywill offer companies that pledge to reinvest in Hungary over the next four years a full exemption on reinvested profits.

The Polish government plans to chargeNetflix,Amazon, Apple TV+, and other large video-on-demand service providers a 1.5 percent fee to assist the country's film industry,which has been stalled by the COVID-19 pandemic.

Charging a tax on financial transactions involving derivatives trading that applies regardless of the market participants' and intermediaries' residence does not constitute a restriction on thefree movement of capital, the EU's highest court held.

Joseph Boris

Work toward a global tax on corporations' digital operations should be suspended so that countries can devote time and resources to rebuilding their economies from the coronavirus pandemic, two tax policy researchers said in a new study.For the Organization for Economic Cooperation and Development, "nowwould be a good time to hit the pause button" on the negotiations, Scott Hodge and Daniel Bunn of the Tax Foundation said in research published Monday. They recommended that the talkswait until the global economy has returned to stabilitywith 2% annual growth for two consecutive years.

Joseph Boris

Ride-hailing service Uber'swariness over acting as a tax data middleman, alongwith travel search engine Booking.com's concern about privacy-law compliance, highlighted comments the OECD saidwednesday it has received through its project to reshape tax rules for the gig economy.

Todd Buell

The European Commission believes that efforts to reform corporate taxation aswell aswork to combat tax fraud are essential tasks, and therefore theywill continue as planned despite the COVID-19 pandemic, according to a draft document seen by Law360.The EU's executive arm plans to issue a communication on fighting tax evasion, according to a draft document. The commission is planning to stick to a timetable, set earlier this year, to issue a communication thatwould involve the tax challenges of moving to digital technology. It also plans to issue another in this quarter on fighting tax evasion, according to the text of a draftwork program.