Int'l Tax News

India and other countries unilaterally introducing online taxes should undo their rules if a global consensus is reached, a senior OECD official said. Grace Perez-Navarro, deputy director of the OECD's Center for Tax Policy and Administration, said nations imposing their own taxes on digital companieswere likelywaiting for an international agreement.

The Czech Republic is preparing to shift its investment incentive system to high-value projects like those in the technology sector, leaving manufacturing companieswith just a few months to seek favorable treatment.

William D. Nordhaus, the Yale economistwho shared the Nobel in economic science thisweek, has pointedwords for some of the experiments so farwith his theories on taxing polluters to fight climate change.

The so-called sixth Directive on Administrative Co-operation ("DAC6", the "Directive"), adopted by the Economic and Financial Affairs Council on May 25, 2018, requires EU member states to introduce in their national law mandatory disclosure rules for cross-border arrangements. Part 2 of this two-part series looks at the additional threshold test that many of the hallmarks set out in the Directive are subject toÔøΩthe main benefit test.

Austria is seeking to present a proposal for a European Union tax on the revenue of tech giants by next month, in a move intended to raise the pressure on the bloc's member states to come to an agreement over the controversial plans.

The idea of imposing a global minimum tax on a company's foreign entities is gaining steam at the OECD. France and Germany have raised the idea of a global minimum tax on multinationals' foreign entities and the OECD's digital task force is looking to deliver "something concrete" in 2019.

G-20 finance ministerswill get their first look at the OECD's analysis of companies' global tax reports at the Group of 20's June 2019 meeting in Fukuoka, Japan. The OECDwill analyze and calculate statistics from an aggregated data set of the reports so countries can better understand how to use the information to assess a company's tax risk.

China's anti-tax evasion campaign, first aimed at the film and TV industry, is likely to spread to the financial services, pharmaceutical, and real estate sectors.

Congress recently enacted Section 965, the "Mandatory Repatriation Tax," a central provision of the TCJA that imposes a one-time tax on U.S.-based multinationals' accumulated foreign earnings. This Essay considers the constitutional concerns raised by this provision and argues that Congress lacks the power to directly taxwealthwithout apportionment among the states. Moreover, the Essay argues that even if Section 965 is found to be an income tax (or, alternatively, an excise tax), the tax is nevertheless unconstitutionally retroactive.

Global foreign direct investment (FDI) fell by 41 percent to $470 billion in the first six months of this year, the lowest since 2005, preliminary figures from the United Nations trade and development agency UNCTAD showed on Monday.

French ministers agreed to cut taxes on corporate patent income to 10 percent Monday as part of awider overhaul to align the country's research incentiveswith global norms.

Mexico's First Circuit Court has recently ruled against a taxpayer involving two transfer pricing adjustments thatwill make it tougher for companies to complywith their domestic tax obligations on time.

Phillips 66 has asked the IRS to clear up ambiguous definitions in proposed transition tax regulations (REG-104226-18) and argues that the section 965 aggregate foreign cash position should exclude forward contracts and commodities inventory that are not traded on an established financial market.

In this article, the author examines the application of anti-hybrid dividend provisions enacted in section 245A(e) to disallow duplicate U.S. and foreign tax benefits for some dividends.

The OECD's Global Forum on Transparency and Exchange of Information for Tax Purposes released another round of peer reviews assessing transparency, finding most of the countries "largely compliant."

The United Kingdom and the EU are finalizing a protocol to theirwithdrawal agreement concerning Gibraltar,which plans on having tax and customs cooperation arrangementswith Spain after Brexit.

Japan's prime minister said the governmentwill proceedwith a 2-percentage-point increase in the consumption tax despite concerns it could have a similar negative impact on economic activity as a previous rate hike.

On June 26 2018 the European Union (Withdrawal) Act 2018 (EUWA) received Royal Assent and therefore became an Act of the British Parliament (law).

The U.S. banking industry is enjoying the benefits of a growing economy and lower taxes, if the double-digit profit growth posted by three major lenders on Friday is any indication.

The IRS has scheduled an October 22 public hearing on proposed regulations (REG-104226-18) implementing section 965. Discussion topic outlines are due by October 16.

An Indian tribunal has restrained tax authorities from penalizing Uber Indiawhile it is hearing the company's claim that it is not liable for making tax deducted at source (TDS) payments on driver compensation.

Singapore's Ministry of Finance has taken issuewith a CNBC article claiming that the country's tax treatywith Indonesia "indulges" the city-state.

Under Dutch law and OECD guidance, profit attributable to a local permanent establishment created by an individual investor may be greater than the investor's return on capital as stipulated in an arm's-length agreement.

Australia's Tax Avoidance Taskforce, created to focus on multinationals, large corporations, andwealthy individuals, collected AUD $5.6 billion (about $3.98 billion) in additional tax revenue during its first two years.

If countries can agree on a fair profit allocation formula to tax the digital economy, then the business sector'sworries about arbitrary and discriminatory tax treatment could be assuaged, according to India's tax chief.

U.K. business leaders urged Chancellor of the Exchequer Philip Hammond to use the upcoming budget to increase tax reliefs to support business investment,while campaign groups recommended tax increases to fund public services.

Walgreens' parent company is crediting the Tax Cuts and Jobs Act for a planned $150 million increase in employeewages, even as officials acknowledge that the TCJA is causing the company headaches abroad.

The New York State Bar Association Tax Section has submitted a report on the rules governing previously taxed earnings and profits (PTI) under section 959 and the related basis adjustments under section 961, primarily focusing on tax code changes under the Tax Cuts and Jobs Act (P.L. 115-97).

Upcoming guidance on previously taxed income (PTI) should note several analytical frameworks that tie the treatment of PTI to alternative possibilities of congressional intentwithin the Tax Cuts and Jobs Act (P.L. 115-97).

The ongoing debate over how best to impose more tax on digital profits increasingly reflects a growing recognition that the problem requires addressing broader concerns about 21st-century profit allocation across jurisdictions. The Australian Treasury, in a consultation paper on digital economy taxation, recently acknowledged the salience of more comprehensive reform proposals. Academics, including two German scholars, are similarlyworking on alternatives to the European Commission's radical digital profits taxation proposals. (Prior coverage: Tax Notes Int'l , Oct. 8, 2018, p. 222.)

The UKwill use a carbon tax to determine the price of emissions in the event of a "no deal" Brexit, according to the latest batch of technical notices issued by the government to prepare businesses for the possibility of such a scenario.

Kuwait, Qatar, and Saudi Arabia haven't traditionally been considered tax havens, but a plan from the Netherlandswould change that reputation.

India's bold moves to tax the digital economy appear to be vindicated as other countries follow suit, a senior official said. Rajat Bansal, a joint secretary at India's Ministry of Finance, defended the country's decision to move unilaterally on taxing online companies, arguing that India helped pioneer a model that otherswere now adopting.

The Dutch governmentwill lower its top corporate tax rate from the current 25 percent rate to less than the 22.25 percent rate announced in the September budget presentation, the Dutch newspaper De Telegraaf reported Thursday, citing people it didn't identify.

Lyndawalker of The Tax Council and Tax Policy Institute and Robert Carroll of EY discuss the results of the 2018 Tax Reform Barometer, a survey of the business community to measure its perceptions of the implementation of the TCJA and other policy issues.

The Internal Revenue Service sets an Oct. 22 hearing on its proposed rules to implement the one-time repatriation tax; a New York State Bar Association Tax Section report recommends beneficial treatment for basis adjustments in calculating previously taxed income so itwon't face another tax.

The Australian Taxation Office has issued updated practical compliance guidelines regarding the treatment of transfer pricing issues related to offshore marketing, sales, and distribution hubs.

In this article, the author discusses the Court of Justice of the European Union's judgment in NN, inwhich loss relief for Danish groupswas successfully challengedwhen a Danish permanent establishment of a nonresident group company encountered final losses that could not be relieved in Sweden because of a Swedish merger operation.

The Australian governmentwants to advance by five years a reduction of the tax rate for small and medium-size businesses from 27.5 percent to 25 percent.

Oxfam onwednesday rejected Singapore's defense of its low taxes after the NGO ranked thewealthy city state among the 10worst-offending countries in fuelling inequalitywith its low-tax regime.

During 2017 and 2018, Mexico's President issued diverse decrees designating the following Mexican regions as special economic zones (SEZs): Puetro Chiapas, Coatzacoalcos, Progreso, Salina Cruz, Dos Bocas, and Champoton. The tax benefits applicable in the SEZs include: exemption of income tax for the first 10 years; fifty percent reduction of income tax for the next five years; zero percent VATwhen acquiring goods for use in the SEZs; zero percent VAT on services rendered to an investor; and goods imported to Mexico to be used exclusively in the SEZs are not treated as imports.

Multinational companies and their advisors have until before 30 November 2018 to comment on the Australian Treasury's Discussion Paper on "The digital economy and Australia's Corporate Tax System." This article examines the Discussion Paper,with some reference to U.K. and European proposals.

The Netherlands' 2019 Budget includes measures to gradually reduce the corporate income tax rates, to limit loss carry forward and to abolish dividendwithholding tax and introduces a conditionalwithholding tax on intra-group dividend distributions to low tax jurisdictions.

India's tax authority isworking to make the country an easier place for multinational companies to do business,which is a shift from its long-running adversarial approach toward foreign companies.

Brazil's leftist presidential candidate Fernando Haddad said in a radio interview on Thursday that he plans to send tax and bank reform bills to Congress if elected in October.

Japanese companies are stepping up plans to move businesses out of the UK, on the premise that their country's tax authorities have granted a temporary amnesty on cross-border mergers between Britain and other EU countries ahead of Brexit.

This article discusses Australia's thin capitalization rulesÔøΩwhich refer to the amount of debt used to fund Australian operations in comparisonwith the amount of equity capital and may limit debt deductions (such as interest) for certain thinly capitalized entities.

Deere & Co., better known as John Deere, is pushing the IRS to grant it a company-specific exception to the 2017 tax overhaul's levy on offshore cash, andwhile the exceptionwould be a narrow one, the tractor maker isn't alone in asking for it.

This article discusses a recent Tax Court case inwhich the taxpayers moved their former operating subsidiaryÔøΩwith its substantial cash holdings after a sale of the operating assetsÔøΩfrom Hong Kong to Cyprus. The author finds the moveÔøΩmade in anticipation of extracting a dividend that the taxpayers sought to classify as "qualified dividend income"ÔøΩdidn'twork out verywell.

Offshore holdings of bonds issued by China's policy banks rose to a new high in September after the cabinet announced a tax-rule change aimed at attracting more foreign participants to theworld's third-largest bond market.