International Tax

 
Tax

Taxation of Trusts in Israel – Types of Trust

A simple guide to four key types of Trust in Israel

November

Will UK's VAT threshold fall?

In its review of VAT, the OTS recommended that the UK government examine the registration threshold for VAT because the current level of £85,000 ($111,300) is unsuitable. The UK has the highest VAT threshold in the European Union, where the minimum threshold is €10,000 ($11,800) but the average is €22,000. The high threshold means that there is a “cliff-edge” for businesses, which offers an incentive to find creative ways to lower turnover in order to avoid paying VAT.

Switzerland: Partial amendment VAT Act from 1 January 2018 and 1 January 2019

As a result of the referendum on 24 September 2017 the VAT rates will be adjusted as of 1 January 2018.

The Senate releases its version of tax reform

On Thursday, the Senate released a detailed description of its initial tax reform bill, the Senate Tax Cuts and Jobs Act (STCJA). The STCJA now heads to markup by the Senate Finance Committee the week of Nov. 13. Majority Leader Mitch McConnell indicated he expects the Senate to hold a vote on the bill before Thanksgiving. If it passes, it would then go to a conference committee to negotiate differences between it and the House version.

Lebanese Government Approved New Tax Changes

The Lebanese Government has approved new tax changes introduced by Law No. 64 dated 20 October 2017, published in the official Gazette on 26 October 2017, deemed essential to fund the additional cost of the salary scale. The new law has introduced new taxes, as well as an increase of rates on existing taxes.

Year-end tax planning letter 2017

2017 has yet to produce any meaningful enacted federal tax legislation. While the House has introduced its tax reform bill, numerous questions remain. As this letter is published, the Senate has yet to weigh in. Although the process continues, how to pay for the proposals and what deductions will be eliminated or modified remain fiercely debated.

House Releases Tax Reform Bill

he House of Representatives released the initial draft of its tax reform bill, the Tax Cuts and Jobs Act (TCJA), on Thursday. The bill now heads to markup by the Ways and Means Committee next week. Speaker Paul Ryan indicated he expects the full House to hold a vote on the bill the week of 13 November.

Harmful tax incentives critically curtailed: BEPS Action 5 in action

BEPS Action 5 – Countering harmful tax practices more effectively by taking into account transparency and substance is one of the four BEPS minimum standards. To date, 102 jurisdictions have committed to its implementation, and 2017 is a decisive year in translating that commitment into action. Achim Pross, Kevin Shoom and Melissa Dejong of the OECD, discuss the first results of the work under BEPS Action 5, and its significance in achieving the goals of the BEPS project.

Highlights of the 2018 Malaysian Budget Proposals

The 2018 Malaysian Budget was presented by the Government of Malaysia on 27 October 2017. The theme of Budget 2018 was ‘Prospering an Inclusive Economy, Balancing between Worldly and hereafter, for the Wellbeing of Rakyat (people of Malaysia) and towards the TN50 Aspiration.

October 2017

GOP Tax Reform Framework and its Impact on International Tax

The GOP released the much-awaited installment of the tax reform guidelines a few days ago, dubbed as the unified framework to overhaul and simplify the Internal Revenue Code.

Amazon and eBay profiting from foreign traders avoiding UK VAT

The UK is losing billions of pounds in revenues each year from online VAT fraud committed by foreign traders. But with Amazon and eBay profiting from the fraudsters, and HMRC not doing enough to tackle the problem, is collaboration or conviction the better solution?

Austria’s Hans Jörg Schelling eyes EU digital tax rules

Austrian Federal Minister of Finance Hans Jörg Schelling has not held back on his views of how to tax multinational corporations so they pay their fair share. He talks to Anjana Haines about what he has planned over the coming year.

Finnish court issues landmark TP ruling involving ERP

The Finnish Administrative Supreme Court on September 13 issued two rulings, korkein hallinto-oikeus (KHO) 2017:145 and KHO 2017:146. Both rulings have been welcomed by Finnish TP professionals as potential trendsetters for future transfer pricing rulings as these are generally scarce in the country.

Q&A: Tomas Balco rolls out busy BEPS agenda as new head of OECD’s TP unit

Tomas Balco brings to the table work experience from the public and private sector, and is known as a consensus builder on both the national and regional level. Prior to taking up the position at the OECD, Balco was the general state counsel and head of international taxation at the Slovak Republic’s Ministry of Finance between 2014 and 2017.

News on Withholding Taxes in 2018 and 2019 in the Netherlands

On 19 September 2017, the Dutch Secretary of State published proposed legislation for the Dutch Dividend Withholding Tax (DWT) Act. The legislation contains significant changes for Dutch Co-operatives (Co-ops) as well as a new general exemption from DWT. It will be brought to Dutch congress during the autumn of 2017 and is likely to take effect on 1 January 2018.

UK and Ireland Brace for Customs Chaos as ‘no-deal’ Brexit Looms

The UK has released a white paper examining possibilities for its post-Brexit customs system once it leaves the EU’s customs union, and a more revealing report by Ireland’s Revenue has added further detail.

Amazon slapped with €250 million bill for illegal state aid

Luxembourg will have to reclaim €250 million ($294 million), plus interest, from Amazon for “undue tax benefits” after the European Commission announced its state aid decision in the case. But the amount is surprisingly small and many say the decision doesn’t tackle the real issue.

September 2017

EU to Redesign Tax Net to Catch Online Giants 

The European Commission (EC) will set out a “strong and ambitious” vision on how to tax the digital economy in early 2018, targeting companies such as Google, Amazon, Microsoft and Apple.

ECOFIN to Consider Virtual PE Rules to Tax Digital MNEs 

Multinational technology giants like Google, Amazon, Apple, Microsoft and Facebook could face higher tax bills under EU plans to introduce virtual permanent establishment rules. However, such rules could be difficult for governments to administer.

Our UK Member Firm MHA MacIntyre Hudson has Published a Corporate Criminal Offences - Business Planning Guide

Our UK member firm has published a guide which sets out the scope of the new offence. It explains the practical steps that businesses should consider taking to protect themselves against criminal liability.

Switzerland: Partial Amendment to the VAT Act from 1 January 2018 and 1 January 2019

VAT law in Switzerland will be subject to partial amendments from 1 January 2018. These amendments could have major impacts for foreign companies.

France Tries to use PE Rules to Make MNEs pay a ‘Fair Share of Tax’

The French permanent establishment rules are the country’s biggest hurdle in taxing Google, Amazon, Facebook and Apple (GAFA) in the way it wants. But it is determined to use these rules to make such digital companies pay what it believes to be their ‘fair share of tax’.


August 2017 

Trump's Tax Reform: Economic Growth Tool or Tax Break for Corporates?

President Donald Trump on Wednesday delivered a new round of promises of a “pro-growth, pro-jobs and pro-American” tax reform, including a 15% corporate tax rate. However, sceptics say his proposals do not match the rhetoric, and that they may be impossible to implement all at once.

The Status of Tax Reform

As the Senate struggled with the repeal and replacement of the Affordable Care Act (ACA), Congress has been working behind the scenes on tax reform. Leadership from both the House and the Senate has been holding discussions with their committees of relevant jurisdiction as well as the White House (this group has informally become known as the “Big Six”). 

OECD’s Base Erosion Profit Shifting (BEPS) and Thailand: Tax Structuring in Thailand Under International Tax Law Changes

Baker Tilly Thailand review specific issues that may need to be reviewed under the Thai and international tax law. 

Brazil Looks to Introduce VAT to Ease Compliance for Corporates

Brazil is seeking to become the latest major economy to introduce a national VAT system to end the torturous system of multiple state taxes that is causing headaches for companies.

Q&A: Maltese Finance Minister Edward Scicluna Surveys a Changing EU Tax Landscape

Scicluna has returned to his role as the Maltese finance minister after the country’s presidency of the EU Council ended in June. When Malta began its six-month presidency, many were sceptical about how the leaders of the small Mediterranean island could achieve their ambitious objectives – particularly the tax measures.

 

July 2017

Trump Set to Axe US Anti-tax Avoidance Measures

A new notice from the IRS reveals President Donald Trump’s plans to revoke Obama-era anti-tax avoidance measures including earnings stripping rules, which could cause an upsurge of inversions.

Q&A: Cypriot Finance Minister Harris Georgiades Wants a More Transparent and Attractive hub for Corporates

Harris Georgiades, Cyprus’ minister of finance, talks to Natalie Leonidou about tax reform and why his country is an attractive investment hub despite the drive for transparency in the wake of BEPS.

Transatlantic ties Smoulder as Ireland set to Collect €15 Billion from Apple

Tax community members on both sides of the Atlantic are holding their breath for a reaction from the US government as the European Commission picks up its investigations into cross-border tax strategies and alleged state aid cases of US tech companies.

New International Tax Treaty in Israel

As part of the effort to reduce the usage of black capital and tax evasion by taking advantage of the international system, the Israeli Tax Authorities recently signed agreements with various countries for the exchange of financial information. 

GST Payable on Supplies of Digital Downloads and Other Intangibles from Offshore 

In 2016, Baker Tilly Pitcher Partners issued an alert to highlight that the Australian Government has enacted measures commonly referred to as the ‘Netflix Tax’ to bring supplies of intangibles made by non-resident suppliers to Australian consumers within Australia’s GST net.

US Income Tax Authorities Targeting Foreign Companies on Non-compliance 

Over the next several weeks, the Internal Revenue Service (IRS) will be sending letters to foreign businesses active in the US to inquire about their compliance with US federal income tax laws. The initiative targets large multinationals importing goods into the US as well as middle-market global companies with US customers. 

Q&A: Pascal Saint-Amans Comes out Fighting for the OECD’s Blacklist and CbCR Standard

The OECD has found itself at odds with both the EU and the Tax Justice Network in the past week over divergent transparency standards. Pascal Saint-Amans, the organisation’s head of tax policy and administration, explains to Salman Shaheen why he believes its blacklist and non-public CbCR standard are the right approach.

Q&A: Nissan Motor’s Soichiro Matsuo and Inga Kondrataite Gain Pole Position on BEPS Implementation

Soichiro Matsuo, global head of TP, and Inga Kondrataite, regional head of tax for Asia Pacific, talk to TP Week from Nissan Motor’s headquarters in Japan about working through the challenges of implementing BEPS measures and CbCR. Their work on documentation, APAs and the management of TP globally has earned Nissan the International Tax Review Asia In-House Transfer Pricing Team of the Year award.

Google not out of the Woods After Landmark $1.25 Billion French Court Victory

After a six-year tussle, Google has emerged victorious after the Paris administrative court found in its favour over a PE dispute. But the French authorities have announced their intention to appeal.

Tax Treatment of Intra-Group Back-to-Back Financial Arrangements

On 30 June 2017, Baker Tilly in Cyprus issued a document stating the Cypriot tax department had issued an interpretative circular relating to the revised tax treatment of intra-group back-to-back financing arrangements.

 

June 2017

Companies Across Germany Could Face State Aid Clawback

German companies could be hit with an unexpected tax bill if the European Court of Justice (ECJ) rules that a commonly used clause in the country’s Real Estate Transfer Tax (RETT) Act constitutes state aid.

GST on Supplies of Low Goods to Australian Consumers: Delayed Until 1 July 2018

Baker Tilly Pitcher Partners recently prepared a tax bulletin in respect of the delay regarding the proposed changes to GST in Australia.

New Cyprus Legislation: Payment of Overdue Taxes by Monthly Instalments  

The House of Representatives approved unanimously the bill proposed by the parliamentary parties, which regulates the issue of payment of overdue taxes by monthly instalments.

Ground-breaking Multilateral BEPS Convention Signed at OECD will Close Loopholes in Thousands of Tax Treaties Worldwide

Taken from the Organisation for Economic Co-operation and Development (OECS) press statement published on 7 June 2017.

 

May 2017

EU Council Adopts Directive to Crack Down on Hybrid Mismatches

The Directive, which is also known as the Anti-Tax Avoidance Directive 2 (ATAD 2), will amend the existing ATAD 1. The rules are designed to stop companies exploiting the differences between the tax systems of EU member states and non-EU countries to avoid paying tax, or to gain a double tax deduction, known as hybrid mismatches.

Litigation, Litigation, Litigation? - How the OECD’s BEPS Guidelines are Affecting Brazil, Mexico and Argentina

The impact of the base erosion and profit shifting (BEPS) guidelines has been manifold in Latin America. Despite the certainty these guidelines have generated in some tax markets, their implementation has seen an increase in court litigation in Brazil, Mexico and Argentina.

Macron’s Victory Puts Corporate Tax Cuts on the Agenda

After 66-34 victory in the French election, Emmanuel Macron faces the difficult task of fighting the legislative elections and building a government to deliver his reform agenda: cutting taxes and public spending. The outcome was a significant relief for European leaders in particular.

Technology Solutions in a Post-BEPS World

There has been a complete paradigm shift in global taxation with the rise in audit risks caused by new global initiatives like the Organisation for Economic Co-operation and Development’s (OECD) Base Erosion and Profit Shifting (BEPS) Project. 

Australia: More Regulation, Less Innovation in the Federal Budget

Baker Tilly Pitcher Partners welcomes the Turnbull Government’s efforts to back small business and invest in infrastructure to grow the Australian economy.

 

April 2017

White House Announces Tax Plan
The Trump administration announced its tax plan on 26 April 2017, labelling it the largest corporate tax cut in history.

OECD Releases Further Guidance on Country-by-country Reporting
Multinationals will have an easier time understanding the requirements of country-by-country reporting due to the release of the Inclusive Framework on base erosion and profit shifting, which contains further guidance on the subject.

GST to Become Payable on Sales of Low Value Goods into Australia From 1 July
In November 2016 the Australian Government announced its intention to impose goods and services tax (GST) on supplies made by offshore suppliers of ‘low value goods’ to Australian consumers. The government has now introduced a Bill into Parliament to enact these changes. The changes are due to commence on 1 July 2017.

Cyprus – Iran and Jersey: Double Tax Treaties Which Have now Entered into Force
The double tax treaties with Iran and Jersey have now entered into force and will come into effect as from 1 January 2018.

Businesses Prepare for GST After Parliament Passes Laws
India’s goods and services tax (GST) regime is set to begin on 1 July after the lower house of parliament passed four GST-related laws and the upper house prepares to do the same.

 

March 2017

Apple Challenges EC’s Use of Arm’s Length in State Aid Case
Apple released its grounds for appealing the €13 billion (US$14 billion) tax bill from the European Commission earlier this week, arguing that the Commission’s arm’s-length test did not comply with EU laws for determining state aid in tax assessments.

India’s GST Almost set for 1 July Implementation 
Businesses have less than two months to complete their preparation for India’s GST regime after the GST Council passed a major landmark in its latest meeting.

A Brief Timeline on the Developments of the LuxLeaks Case 
International Tax Review breaks down the developments that led to the conviction of former PwC employees Antoine Deltour and Raphaël Halet, who exposed more than 300 multinational enterprises benefiting from sweetheart tax deals with the Luxembourg authorities to avoid taxes in Europe. 

 

February 2017

US Tax Reform
The new US Presidential administration and Congress have created much speculation and anxiety about how tax reform will proceed and who will be most affected by the result. Baker Tilly in the US is dedicated to keeping you abreast of significant tax reform proposals and enacted legislation.

 

January 2017

UK Prime Minister Set Out Government’s 12 Negotiating Objectives for Brexit
On 17 January 2017 UK Prime Minister, Theresa May, set out the Government’s 12 negotiating objectives for leaving the European Union (EU). Below is the extract from her speech.