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Int'l Tax News

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Medtronic, IRS Head to Trial Again in 2020 Over $1.4B Dispute


Medtronic Plc is once again headed to trialwith the IRS in a $1.4 billion case over the value of intellectual property it transferred offshore.

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Indonesia Formulates Digital Tax Scheme for Tech Giants


The government is exploring mechanisms to calculate tax responsibilities of giant technology companies, such as Google and Facebook, according to Finance Minister Sri Mulyani Indrawati.

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India, U.S. May Win With Global Tax Rewrite, but It's Complicated


India, the U.S., and other countrieswith hundreds of millions of consumers and large import markets could rake in a bigger share of multinational tax revenue under a plan to change global tax rules.

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Canada 2019 Budget- Impact of Tax Measures on Multinational Corporations


Matias Milet and Roger Smith, of Osler, Hoskin & Harcourt LLP highlightwhy multinational corporations should be aware of the changes announced in Canada's 2019 Budget.

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New Zealand Pursuing Digital Tax Ahead of OECD's Plan


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Bigger OECD Tax-Risk Assessment Program May Be 'Challenging'


The logistics of an OECD pilot program designed to assess international tax risks of large multinational companies could be difficult to handle as it grows to include twice as many participants said Doug O'Donnell, commissioner of the Internal Revenue Service's Large Business and International Division.

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Dutch Lawmakers Want Review of Corporate Tax Regime


Dutch lawmakers are urging the government to direct a special committee to findways to ensure multinational companies pay their fair share of tax in the Netherlands.

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IMF Urges G-20 to Rein in Tax-Related Profit Shifting


The International Monetary Fund urgedworld leaders to reform international tax rules that allow companies to pay little or no tax by shifting their assets to low-tax jurisdictions.

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Automation and Data Analytics to Drive LB&I Audit Selection


Businesses use data analytics to target their online ads at likely customers. Now the IRS's Large Business and International Divisionwill use that tool to determinewhich large and complex corporate taxpayers to audit. Carina Federico and David Blair of Crowell & Moring explain how andwhy.

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New Indian Finance Minister Kicks Off Pre-Budget Meetings


Indian Finance Minister Nirmala Sitharaman heard from industry representativeswho are urging corporate tax reforms in the full fiscal 2019-2020 budget.

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India's Cabinet Ratifies OECD's Tax Super-Treaty


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New Zealand's New R&D Tax Incentive


The new R&D Tax Incentive is opening up opportunities for more businesses doing R&D in New Zealand. Anand Reddy, Jill Somerfield and Nadinewilliams of PwC New Zealand consider how to maximize the benefits for your business.

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U.S. Multinationals Get High-Tax Exclusion, Anti-Abuse Rules


U.S. multinationals got a mixed bag of IRS guidance today on new international measures under the 2017 tax overhaul that includes a much-requested exclusion under a new category of foreign income and proposed anti-abuse rules thatwould restrict tax deductions related to foreign-source dividends.

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Anti-Abuse Rules Limit Tax Deduction on Foreign-Source Dividends


New IRS anti-abuse regulations limit a tax break available under the 2017 tax law for certain dividends a U.S. company receives from a foreign company inwhich it owns shares. The IRS released the rules in temporary and final form June 14. The agency also released proposed regulations that cross-reference the temporary rules.

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Rules Guide Multinationals on 'GILTI' and Foreign Tax Credits


U.S. multinationals now have guidance on a 2017 tax law provision intended to ensure that companies pay at least a minimum amount of tax on overseas profits.

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10 EU Countries OK Financial Transaction Tax Revenue-Sharing Plan


Ten European Union countries have agreed on a revenue-sharing plan for the bloc's proposed financial transaction tax thatwould reimburse the administrative costs of countries that have small stock markets and few large companies.

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Tax Will Help Combat Income Inequality, EU Tax Chief Says


Pierre Moscovici, the EU's top tax official, said that tax policy is crucial in the European Commission's efforts to curb income inequity as it seeks to battle populism among its member countries.

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U.S. Wants to Stall Digital Tax, Hoping to Wear Down Allies


The Trump administration is deep in talkswith 129 other countries on implementing a new standard for taxing digital companies, including Alphabet Inc.'s Google, Facebook Inc. and Amazon.com Inc.ÔøΩbut its heart lies elsewhere in the discussions.

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Financial Transaction Tax May Help EU Fix Brexit Budget Shortfall


Germany and Francewill push European Union finance ministers June 14 to rally around a financial transaction tax that could help fill a potential EU Brexit budget hole.

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Dutch Lawmakers Accuse Snel of Backtracking on Tax Change Promise


Dutch opposition lawmakers lambasted a senior finance official for dialing down a motion aimed at ensuring that multinational corporations are taxed more fairly in the Netherlands.

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Altera, the Sequel - Jurisprudence Catches Up With BEPS


Robert Goulder critiques the Ninth Circuit's revised opinion in the Altera litigation,which breathes new life in the commensurate-with-income language of section 482.

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Netherlands Considers Amending Tax Consolidation Regime


Citing pressure from adverse EU case law, the Dutch government has opened a public consultation on amending or abolishing the country's tax consolidation regime to complywith the EU's freedom of establishment rules.

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Participation Exemption Antiabuse Rule May Spur Litigation


Treasury's new anti-abuse rule on the dividends received deduction that addresses a timing mismatch between the participation exemption regime and other international tax rules has teed itself up as a target of future taxpayer litigation.

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IRS's GILTI Partnership Pivot Could Mean Big Changes (1)


The IRS and Treasury's change of approach in newly proposed regs navigating partnerships under the global intangible low-taxed income provision could result in significantly less income inclusions for some taxpayers.

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Treasury Narrows Reach of Foreign Income Levy to Fix 2017 Law


The Treasury Department has narrowed the reach of a new tax aimed at technology and pharmaceutical companieswith overseas income,wiping out an unintended consequence of President Donald Trump's 2017 tax overhaul.

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A Digital Services Tax for New Zealand- Time to Jump on the Bandwagon?


The New Zealand tax office is preparing to take aim at some of theworld's biggest tech giants,with Google, YouTube, Uber, Facebook and Instagram allwithin its sights. In consideringwhether to enact a new digital services tax, New Zealand is following the lead of numerous other countries. Simon Akozu and Zoe Barnes, of MinterEllisonRuddWatts, considerwhether it is the right time for New Zealand to follow suit.

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Canada Proposes Limiting Stock Option Tax Breaks


Canada plans to hike taxes on stock options that top-paid executives receive from large companies. The changes proposed in draft legislationwould bring Canada's tax treatment of stock options more in linewith U.S. tax treatment of options and restore the tax break's focus on helping small companies, like start-ups.

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France Plans to Scrap 1 Billion Euros of Tax Breaks for Companies

  • By Reuters

France plans to scrap 1 billion euros (890.15 million pounds) of tax breaks for companies to help fund a pledged 5-billion-euro reduction in personal income taxes, Budget Minister Gerald Darmanin said on Sunday.

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Italy Deputy PM Di Maio Says EU Must Allow Italy to Cut Tax, Invest

  • By Reuters

The European Union should allow Italy to cut tax and invest in the green economy to boost the country's economy, Deputy Prime Minister Luigi Di Maio said on Monday.

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Conservative groups tell Congress: 'We oppose any carbon tax'


A group of 75 conservative organizations and leaders on Monday sent a letter to Congress expressing their opposition to a carbon tax, pushing back at an idea that has received support from politicians and policy experts on both sides of the aisle as away to combat climate change.

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Security Specialists Urge House Panel To Target Shell Cos.


A group of national security specialists urged a U.S. House of Representatives committee Monday to adopt legislation thatwould target shell companies, citing a report that says the anonymous ownership of businesses can facilitate tax evasion and other crimes.

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U.S. Corporate Cash Piles Drop to Three-Year Low


U.S. corporate balance sheets continue to feel the impact of the 2017 U.S. tax overhaul, as companies pivot their capital allocation strategies in response to the new law. Companies funneled record amounts of cash to stock buybacks, dividends, capital spending and acquisitions last year. As a result, U.S. corporate cash holdings fell to a three-year low of $1.685 trillion in 2018, according to a report from Moody's Investors Service Inc.

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The Tory Tax Debate

  • By The Editorial Board

Britain's next Prime Ministerwill have the dual challenge of leaving the European Union and setting up the newly independent country for economic success. So it's a good sign that some top contenders for the Conservative Party leadershipÔøΩthewinnerwill replace Theresa MayÔøΩstartedwith tax reform as campaigning began on Monday.

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The application of global tax reforms to the extractive industries

  • By International Tax Review

Alexandra Readhead investigateswhether IMF and OECD proposals on how to tax the digital economy, apply formulary apportionment, shift taxing rights and address profit shifting could apply to the natural resources sector. Alternatively, could source-based taxation improvements hold the answer?

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Businesses disappointed with OECD's progress on digital tax reforms


As G20 countries ratify the OECD'swork on taxing the digital economy, tax executives expressed their concerns to International Tax Review that the body has not moved beyond proposals that they find problematic.

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Newly Elected EU Body Likely To Stay Progressive On Taxes


The European Parliament is expected to continue to push progressive legislation on tax matters following an election last month that saw eroded support for centrist parties. In recent years the Parliament has advocated laws requiring big corporations to publish their tax affairs and has voted for a common corporate tax base in Europe. It has also expressed support for taxing large digital corporations and pushed for laws that require tax advisers to disclose more of their activities to authorities.

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US companies fear TCJA amendments by Democrats


Some US taxpayers are considering inversions because they fear negative tax implications if the Democrats gain control of the presidency and Congress in the 2020 elections and raise tax rate.

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Changes in Final Section 956 Regs


Whilewe'rewaiting for the big Tax Cuts and Jobs Act regulations on June 22, section 956 is still in the law, so there are final section 956 regulations to think about. To recapitulate, global intangible low-taxed income and section 245A regulations are expected by June 22. The GILTI ruleswill be accompanied by a notice of proposed rulemaking, the scope ofwhich is unclear, according to Raymond Stahl, senior counsel, IRS Office of Associate Chief Counsel (International). Practitioners are particularly concerned about the effective date of the section 245A rules, because companies made interim distributions that they hopewill qualify for the dividends received deduction (DRD).

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The TCJA's Impact on GAAP Effective Tax Rates of Large U.S. Nonfinancial Corporations


The article assesseswhat effect the Tax Cuts and Jobs Act had on the effective tax rates (ETRs) of large U.S. nonfinancial corporations based on information in the generally accepted accounting principles financial statements corporations includewith their annual SEC Forms 10-K. I evaluate both the TCJA's one-time adjustments,which mainly affect corporations' ETRs for 2017, and the TCJA's permanent adjustments,which mainly affect corporations' ETRs for 2018.

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Costa Rica Considers VAT Rules for Cross-Border Digital Services


Costa Rica's Ministry of Finance has released a draft resolution implementing VAT rules for nonresidents supplying cross-border digital services in Costa Rica. The country is in the process of converting its sales tax to a VAT, effective July 1. The VATwill be levied on all supplies of goods and services. The standard ratewill be 13 percent, but reduced rates of 4 percent, 2 percent, and 1 percent, aswell as some exemptions,will apply to specific supplies. Export saleswill be zero-rated.

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Impact Assessments of Tax Proposals Top OECD 2019 Agenda


The OECD's goal by fall is to release an initial report assessing the impact of various proposals for overhauling the international tax system in the digital age, according to officials.

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'Spirit of Compromise' Needed for BEPS 2.0 Agreement


Each country comes from different economic backgrounds, so it's no surprise that they have different views and opinions on how to address the tax challenges of digitalization, Asō added. For countries to reach consensus on a solution by the end of 2020, "we must all bring a spirit of compromise to the table," Asō said. The G-20 should lead by example, he said, because "high-level political engagement and endorsement by G-20 memberswill make it possible to overcome this hurdle and to close the remaining gaps in our views."

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Global FDI Down in 2018 Due to Government Interventions, Trump, Brexit-U.N.

  • By Reuters

Global foreign direct investment (FDI) fell by 13 percent last year because of government intervention, Brexit uncertainty and U.S. President Donald Trump's tax and trade policies, the United Nations trade and development agency UNCTAD said onwednesday.

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Dutch Lawmakers Step Up Tax Demands on Multinationals

  • By Reuters

Dutch lawmakers have launched an inquiry into how to make multinationals pay their fair share of tax, after public criticism that government reforms do not go far enough.

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Senate To Vote On Tax Treaties This Year, Lawmaker Says


U.S. Senate Republican leaders have decided to bring several bilateral tax treaties that have languished for years to a vote in the full chamber this year, the chairman of the Senate Foreign Relations Committee told Law360 on Tuesday.

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Germany Wants 0.2% Minimum EU Financial Transaction Tax


A proposed financial transaction tax in the European Union should be set at "no less than 0.2%" of the value of the transaction, according to a note from the German delegation to the EU's Economic and Financial Affairs Council,which is due to meet Friday in Brussels.

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Case study: Shell's participation in ICAP


Danny Houben, project lead for Shell's ICAP team, talks to International Tax Review about how his company got ready to participate in the OECD's International Compliance Assurance Programme (ICAP).

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Practitioners Pragmatic About Dutch Tax Changes


Although public and political opinion has shifted regarding the Dutch tax system's favorability to multinationals, not that much has changed in practical terms, according to practitioners. The Dutch parliament voted June 11 to establish a six-month expert committee to advise legislators on how to structure the country's tax system to ensure that multinational enterprises pay more taxes in the Netherlands.

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Presidential Hopeful John Hickenlooper Calls for Carbon Tax

  • By The Associated Press

A carbon tax is part of the climate plan that Democratic presidential candidate John Hickenlooper is backing. He's the latest candidate to outline a plan to combat globalwarming. Alongwith the carbon tax, the former Colorado governorwould spend $350 billion on green infrastructure and efficient cars, rejoin the Paris climate accords and invest more in green technology research.

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EU Tries to Revive Plan for Financial Transaction Tax

  • By Reuters

European Union finance ministers have discussed on Friday a plan for a 0.2% tax on shares,which Germany sees close to be agreed, although furtherwork remains to be done. Plans for an EU financial transaction tax (FTT) have stumbled over the past years. After an initial proposal in 2011was blocked by member governments, a group of states pressed ahead,while the majority of the 28 EU states backed down.

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