KPMG’s Week in Tax: 7-11 December

KPMG’s Week in Tax: 7-11 December

The European Council this week adopted a directive requiring EU Member States to exchange information automatically on advance cross-border tax rulings and advance pricing arrangements (APAs). The directive is scheduled to apply beginning 1 January 2017.

Related content

  • EU: The Council of the EU (ECOFIN) discussed the current state of a proposal pending in certain EU Member States to introduce a financial transaction tax (FTT). Ten EU Member States—Austria, Belgium, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia, and Spain—provided details of expected features of the financial transaction tax, and issued a statement setting out areas where agreement had been reached as well as areas that were still open. 
  • UK: The draft clauses for Finance Bill 2016 were presented.
  • Cyprus-Switzerland: An income tax treaty entered into force, and will be effective 1 January 2016. The treaty does not include a limitation on benefits (LOB) clause.
  • Austria: Changes to Austrian GAAP (effective 31 December 2015) require all businesses to recognize unrealized capital gains for all types of fixed and current assets. Any appreciation is generally fully taxable, and taking into account the 75% loss utilization restriction, “paper profits” could be taxed.
  • Netherlands: The Deputy Minister of Finance announced that an agreement had been reached, and that there was sufficient support to advance the “2016 Tax Plan” through the Upper House.
  • Sweden: Changes to the tax law, effective 1 January 2016, reflect additions of anti-avoidance provisions to the EU Parent/Subsidiary Directive and are intended to bring Swedish tax law into compliance with the directive.
  • Belgium: New guidance concerns the rules on input value added tax (VAT) deductions related to business assets that are used for professional and private purposes—“mixed use” assets including company cars—and that historically have been the subject of various decisions and parliamentary questions.

United States

  • Treasury further extended the filing date for the “Report of Foreign Bank and Financial Accounts” (FBAR) to be filed by certain individuals who have only signature authority over certain foreign financial accounts to 15 April 2017.
  • A conference agreement on a trade bill, reached in the U.S. Congress, includes a permanent internet tax ban—that is, it would ban states and localities from taxing internet access or placing multiple and discriminatory taxes on internet commerce. 
  • An IRS notice provides “questions and answers” (Q&As) about the implications of a U.S. Supreme Court decision on same-sex marriage and retirement plans and health and welfare plans. 

Americas

  • Canada: Two tax rate changes for individuals will be effective 1 January 2016: (1) a reduction in the federal tax rate for income between $45,283 and $90,563 to 20.5% (from 22%), and (2) an increase of 4% in the tax rate for income over $200,000 to 33%. ($ = Canadian dollar)
  • Brazil: Brazil’s tax authority announced new deadlines (in May and June 2016) for certain information e-filings by corporate taxpayers for 2015.

Asia Pacific

  • Australia: Parliament concluded legislative action for this calendar year: (1) the multinational avoidance rule was passed, and (2) the country-by-country reporting regime was passed.
  • Australia-China: A free trade agreement will enter into force on 20 December 2015, with immediate benefits of first-year tariff reductions from that date. The second year of tariff reductions will begin 1 January 2016, thus delivering two rounds of tariff reductions in close succession.

FATCA

Cayman Islands: Guidance relating to the common reporting standard (CRS)—scheduled for implementation beginning 1 January 2016—was issued.

United States: The IRS updated the frequently asked questions (FAQs) on the FATCA webpage.

 

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

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