KPMG's Week in Tax: 28 September - 2 October

KPMG's Week in Tax: 28 September - 2 October

The Organisation for Economic Co-operation and Development (OECD) this coming Monday, October 5, will release final recommendations relating to the base erosion and profit shifting (BEPS) project. Many jurisdictions across the globe—from Europe to the Americas to the Asia Pacific region—are already taking action related to BEPS recommendations, and it is expected that more countries will do so following this final round of recommendations.

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KPMG tax professionals will discuss the BEPS recommendations during a webcast on Wednesday, October 14 from 9:00 a.m.-10:00 a.m. EST.  Register now for the October 14 webcast.

CRS, FATCA developments

  • Australia: Proposed legislation would require implementation of the OECD common reporting standard (CRS) relating to the automatic exchange of financial account information. If implemented, CRS would have broader reach and affect more taxpayers than does the FATCA regime.
  • US: The IRS released an advance version of Rev. Proc. 2015-50 that lists 16 countries with which the IRS and Treasury have determined that it is appropriate to have an “automatic exchange” relationship for purposes of reporting payments of deposit interest.
  • UK: HM Revenue & Customs released an informal consultation on the guidance notes for the automatic exchange of financial account information.
  • IGAs: The IRS reported that Cambodia and Montserrat each signed an intergovernmental agreement (IGA) that reflects the Model 1 IGA. 

Read more at TaxNewsFlash-FATCA

Global developments

  • Indonesia: The debt-to-equity ratio under the thin capitalization rules that regulate the deductibility of finance expenses for purposes of calculating the corporate income tax payable is set at 4:1 maximum for fiscal year 2016.
  • China: Officials announced a plan to revise and expedite traditional bonded processing, to reflect modern logistics and traditional trading businesses, and to facilitate transactions involving cross-border leasing, cross-border e-commerce, maintenance and testing, and reproducing industries.
  • Vietnam: Guidance reaffirms a rule with respect to corporate income tax incentives, providing that a newly incorporated company in an incentive location that also generates income from business activities conducted in other areas must separately record the revenue generated from each incentive area and from the non-incentive areas.

Read more at TaxNewsFlash-Asia Pacific

 

  • EU: The European Commission announced the launch of a capital markets union action plan, to provide a “true single market for capital” across the 28 EU Member States.
  • Italy: The Italian Council of Ministers adopted a decree to extend the Italian voluntary disclosure procedure to 30 November 2015.

Read more at TaxNewsFlash-Europe

United States

  • The president signed into law H.R. 3614, the “Airport and Airway Extension Act of 2015” thereby extending the excise taxes (and related tax rates) that apply for airlines and others, through March 31, 2016.
  • The Internet Tax Freedom Act has been extended until December 11, 2015, as part of a continuing resolution to fund the federal government through December 11, as passed by Congress and signed by President Obama on September 30, 2015.  The legislation prevents state and local governments from taxing internet access, or imposing multiple or discriminatory taxes on electronic commerce. States and localities that had imposed and enforced taxes on internet access prior to October 1, 1998, may continue to do so under “grandfather provisions” (seven states impose tax internet access). With this most recent extension, the original three-year moratorium enacted in 1998 will have been extended a total of six times (including temporary extensions).

Read more at TaxNewsFlash-United States

 

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

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