KPMG’s Week in Tax: 31 August - 4 September

KPMG’s Week in Tax: 31 August - 4 September

U.S. tax developments reported this week include the following:

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  • Regulations address a number of issues under the “Subpart F” regime applicable to controlled foreign corporations (CFCs) and their U.S. shareholders. In general, the regulations expand application of the rules to CFC acquisitions of “United States Property,” certain partnership distributions, and certain transactions involving rents and royalties. The new rules also explicitly state that for investments in United States Property, a deemed exchange pursuant to section 1001 constitutes a new acquisition of the property.
  • Proposed regulations address the health insurance premium tax credit under section 36B. 
  • Regulations provide rules and procedures to be followed by multiemployer plans that are projected to have insufficient funds to pay full benefits that plan participants would otherwise be entitled, when such plans are in “critical and declining status.”
  • In Puerto Rico, guidance regarding the sales and use tax (IVU) treatment of designated professional services and business-to-business services was issued. Beginning 1 October 2015, business-to-business services (B2B) that currently are not subject to IVU, and designated professional services will be subject to a commonwealth IVU at a rate of 4%.
  • A Puerto Rico tax commission advised moving forward to implement a value added tax (VAT) system.

Read more at TaxNewsFlash-United States

FATCA developments

  • Luxembourg: Tax authorities released a final version of an administrative circular and an updated administrative circular to implement provisions under the FATCA regime concerning the automatic exchange of information between Luxembourg and the United States.
  • St. Kitts and Nevis: U.S. Treasury reported the signing of a Model 1 IGA.

Read more at TaxNewsFlash-FATCA

International tax news

  • France: A judgment by the Court of Justice of the European Union (CJEU) concludes that the French rules providing different tax treatment of dividends received by parent companies of tax-integrated groups, with the treatment depending on where the subsidiaries are established, is contrary to EU law. Read TaxNewsFlash-Europe
  • Mexico: Taxpayers in Mexico prevailed in district court actions, with respect to their challenges to rules requiring taxpayers to provide monthly information accounting statements to the tax authorities. The decisions, however, are not seen as being final, and it is anticipated that the tax authorities will appeal. Read TaxNewsFlash-Americas

Read these and other items reported this week at the TaxNewsFlash United States and Global websites.

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