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Int'l Tax News

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Former Fed Leaders, Economists Rally Around Carbon Tax


An all-star roster of former Federal Reserve leaders andwhite House economic advisers are signing on to a new statement in support of a carbon tax on businesses that sends the revenue to U.S. citizens.

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Goldman Sachs Stock Jumps After TCJA Recalculation


The stock market's reaction to Goldman Sachs Group Inc.'s fourth-quarter 2018 and year-end earnings reportswas unusually positive, thanks in part to a significant, and arguably obscured, tax benefit.

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Swiss Tax Reform Critics Claim Enough Signatures for Referendum


Opponents of Swiss tax reform legislation say they have gathered enough signatures to require a nationwide referendum on the law,whichwas enacted after EU complaints that the country's cantonal tax regime favors multinational companies.

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Swedish PM Wins Second Term With Coalition Deal for Tax Cuts


Sweden's Parliament voted in Prime Minister Stefan Löfven for a second term after he secured a tenuous coalition minority government agreement involving tax cuts, ending months of uncertainty in thewake of an ambiguous election.

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Indian High Court Rules Against GE Subsidiary in PE Case


Complex contract negotiationswith customers undertaken by an Indian subsidiary of General Electric are sufficient to create a dependent-agent permanent establishment and taxable presence for other group subsidiaries resident in the United States.

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Coca-Cola Case Offers Guidance on Reliance on Closing Agreements


The U.S. Tax Court's decision in Coca-Cola's ongoing transfer pricing disputewill provide taxpayerswith guidance regarding the level of reliance they can place on past closing agreementswhen determining future transfer pricing approaches.

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Hybrid Regs Offer Some Certainty but Lots of Complexity


The plethora of examples included in the proposed hybrid regs provides a dose ofwelcome certainty for practitioners, but the proposed regs' complexitywill require extensive knowledge of company structures.

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Three Attempts to Fix GILTI


This article,which focuses on a few questions that have arisen over the global intangible low-taxed income regime, highlights the challenges taxpayers and the governmentwill continue to face in attempting to make sense of the complex, confusing, and often internally inconsistent changes the TCJA made to international tax rules.

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Learning to Love GILTI


The TCJA tax on GILTI is simultaneously a minimum tax and a separate foreign tax credit basket (section 951A). GILTI,which is a residual, presumes that extranormal foreign profits are attributable to intangibles. GILTI claws back this extra income using a subpart F mechanism, but it is technically not a subpart F inclusion. GILTI is not limited by earnings and profits.

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ABA Tax Section Recommends Modifying Proposed GILTI Regs

  • By Tax Analysts

Eric Solomon of the American Bar Association Section of Taxation has submitted comments on proposed regulations (REG-104390-18) implementing provisions of the Tax Cuts and Jobs Act that require U.S. shareholders to include global intangible low-taxed income generated by controlled foreign corporations in their gross income. The TCJA added section 951A,which requires a U.S. shareholder of any CFC to include their GILTI in their gross income. The proposed regs provide guidance on determining the GILTI inclusion amount.

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Panama Expands Scope of Special Economic Zone Benefit


A law published recently in Panama's official gazette has extended the scope of the preferential tax regime under the Panama-Pacifico special economic zone to office administration services.

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Peru Specifies Entities Subject to Beneficial Ownership Rules


A decree that took effect January 8 in Peru lists the types of entities that are subject to the ultimate beneficial ownership tax regime.

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BEPS Has Failed on Key Issues, Corporate Tax Reform Group Says


The OECD's base erosion and profit-shifting project has failed to address some of the problems that gave rise to the project, and doesn't amount to real international tax reform, according to a nongovernmental organization.

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Destination-Based Cash Flow Tax Would Increase Global Investment


Replacing a corporate income taxwith a destination-based cash flow tax (DBCFT)would yield significant macroeconomic benefits for the country making the switch and its trading partners, especially if other countries do so aswell.

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New York Governor's Budget Proposes to Codify GILTI Apportionment


New York Democratic Gov. Andrew Cuomo's recently released fiscal 2020 budget proposes to codify the state tax department's recent guidance on global intangible low-taxed income.

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CJEU Clears Release of Tax Information to Customs Authorities


Customs authorities may demand disclosure of tax information related to select individuals associatedwith a company seeking status as an authorized economic operator, according to the EU's highest court.

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Danish Tax Agency Collecting Cryptocurrency Information


Denmark's Tax Agency said it has been authorized to obtain tax information from three domestic cryptocurrency exchanges and has already accessed data on Danish taxpayerswho have used a Finnish bitcoin exchange.

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EU countries support protections for tax evasion leaks


A majority of EU countries saidwednesday that protections granted towhistleblowers, includingwhen it comes to fiscal matters, should be covered by just one piece of legislation, two EU officials told POLITICO.

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Estonia Implements EU Antiavoidance Directive


Estonia's Bill on Amendments to the Income Tax Act entered into force January 1, implementing Council Directive (EU) 2016/1164 (the antiavoidance directive).

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Bill Would Exclude GILTI From Virginia Tax Base


Global intangible low-taxed incomewould be excluded from Virginia's tax base under a recently introduced state Senate bill.

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Indonesia Issues Rules Governing Taxation of E-Commerce


Indonesia's government has issued regulations requiring small to medium-size online businesses to pay tax at a rate of 0.5 percent of sales,while larger e-commerce companies must pay corporate income tax at a 25 percent rate.

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Switzerland Outlines Position on Taxation of Digital Economy


As the OECDworks on long-term solutions for taxing the digital economy, the Swiss government has published its positions on how to proceed, stressing the importance of innovation and sustainable competitionwhile safeguarding tax receipts.

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Corporate Tax Rates Trending Down Over Past 20 Years, OECD Says


Although rates have fallen over the past two decades, corporate tax remains a key revenue source for government coffers, especially in developing countries, the OECD said in a new report.

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U.S. Hybrid Rules Require Extensive Knowledge of Structures


Some practitioners may need to brush up on their knowledge of company structures following the release of exceptionally extensive proposed hybrid regs.

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Transition Tax Regs Offer Limited Relief on Big-Ticket Items


Final transition tax regs offer some modifications to a few hot-button issues, but the relief sought by taxpayerswho had lobbed a multitude of critiques at the proposed regs is limited in many circumstances.

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Moscovici Introduces Qualified Majority Voting Proposal


EU Tax Commissioner Pierre Moscovici sought to convince member states to cede their right to veto tax measures in the EU Council by invoking annual VAT losses of ÔøΩ50 billion.

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EU Tax on Big Digital Companies Could Be Struck by March: French Minister

  • By Reuters

A European Union-wide tax on theworld's top digital companies could be reached by the end of March, French Finance Minister Bruno Le Maire said in an interview published on Sunday.

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Swiss Advisory Board Recommends WHT, Property Tax Reform


The advisory board taskedwith reporting on the state of Switzerland's financial center has recommended changes to the country'swithholding tax and property tax regimes.

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EU's majority voting proposal puts CCCTB back on the table


The common consolidated corporate tax base (CCCTB) and digital services tax (DST) could be introduced if the EU Commission's proposal for qualified majority voting (QMV) succeeds.

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Gibraltar Introduces New Thin Capitalization Restriction


Gibraltar recently enacted the Income Tax Act 2010 (Amendment No. 3) Regulations 2018,which introduced a new limitation on the deductibility of interest on debt.

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New York Quietly Updates Tax Forms With GILTI Guidance


New York corporate taxpayers now have some guidance on global intangible low-taxed income after the state's tax department quietly updated its filing instructions for business corporate franchise tax returns.

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Austria to Tax Online Advertising, Expand Online Sales Taxation


Austria has announced plans to impose a 3 percent tax on online advertising. It also plans to levy VAT on all goods sold online by third-country retailers and to strengthen reporting obligations for online platforms.

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Dutch Eye French-German Minimum Tax Proposal With Interest


The Netherlands' top finance official is touting his newwithholding tax on interest and royalties as a key anti-tax-avoidance measure, but he is also eyeing France and Germany's minimum tax proposal to possibly complement it.

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Cost of Unanimity on Tax Rules Will Only Increase, Group Says


Tax reform in the European Union needs to move faster than the unanimity requirement permits, according to a think tank that has endorsed a controversial remedy requiring unanimous approval.

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Brussels' bid to kill tax veto faces uphill battle


The European Commission's plan to eliminate the veto that EU governments hold over any of its tax initiatives faces a major obstacle: the veto.

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Tax reform isn't the foreign cash magnet that was promised - yet


Just as many U.S. multinationals are still trying to unravel the ins and outs of the complex tax reform package, foreign companies are doing the same. As a result, they're taking await-and-see attitude. In particular, there are numerous European and Chinese manufacturing companies considering U.S. investments, but for non-tax, business-related reasons. For them, the rate cut is little more than the proverbial cherry on top of the sundae. It isn't the reason to make a major move.

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A Major EU Tax Flub

  • By The Editorial Board

The European Union's high-tax nations have tried for years to thwart tax competition from smaller states such as Ireland and Luxembourg. But do they have to ramp up that effort again right as the EU is in danger of another economic slowdown? Apparently so. The bureaucrats at the European Commission on Tuesday unveiled a new proposal to make it easier for high-tax France and Germany to steamroll low-tax members. Brusselswould do this by ending the veto that individual governments can currently exercise on tax matters, shifting to a system of "qualified majority voting" that favors larger countries. Thiswould allow 55% of member states representing at least 65% of the EU population to set important tax policies for the entire bloc.

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Mexico introduces new tax incentives to stimulate financial sector


As part of a multidisciplinary strategy by Mexico's Central Bank and Ministry of Finance and Public Credit to stimulate the nation's financial sector, a presidential decree on January 8 introduced several new tax incentives. Mexico's new tax incentives,which are effective immediately, are largely intended to incentivise Mexican entities to raise funds at a lower cost and from awider array of foreign investors, and to overall encourage private Mexican companies to become public.

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Corporate tax remains a key revenue source, despite falling rates worldwide

  • By OECD

OECD

Taxes paid by companies remain a key source of government revenues, especially in developing countries, despite theworldwide trend of falling corporate tax rates over the past two decades, according to a new report from the OECD. The new OECD analysis shows that corporate income tax remains a significant source of tax revenues for governments across the globe. In 2016, corporate tax revenues accounted for 13.3% of total tax revenues on average across the 88 jurisdictions forwhich data is available. This figure has increased from 12% in 2000.

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HMRC launches new clampdown on diverted profits


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.

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OECD Fight Against Tax Treaty Shopping Gains Another Member


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.

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Germany, France Push for 0.2% Tax on European Stock Trades


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.

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Austria's 3% Digital Tax Could Net Large Media Companies


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.

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Austria Taps Google to Help Finance $5.2 Billion Tax Cut


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.

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Perrigo Said to Weigh Shelving Irish Expansion Amid Tax Battle


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.

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Stalled Tax Laws Cost EU $277B in Lost Revenue


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.

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EU Commission to Propose Abolishing Vetoes on Tax Policy: Doc


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.

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Merkel's Party Wants Tax Cuts to Fend Off German Slowdown


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.

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Indonesia's E-Commerce Tax Plan Faces Resistance from Industry


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.

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Overview of the New Proposed Regulations on Interest Deduction Limitation Rules


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.

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