KPMG’s Week in Tax: 22-26 February 2016

KPMG’s Week in Tax: 22-26 February 2016

Tax developments or tax-related items reported this week include the following items.

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BEPS

  • OECD: A proposal to be presented at a 26-27 February meeting would allow all interested countries and jurisdictions to participate as “BEPS associates,” and thus not limiting participation to OECD or G20 member countries.
  • New Zealand: Discussion document on implementing the automatic exchange of information (AEOI) regime requiring: (1) New Zealand financial institutions to report foreign account holders to countries that have also signed up for AEOI; and (2) the automatic exchange of tax rulings and unilateral transfer pricing rulings, in effect as of 2014, with treaty-partner countries.

Africa

  • South Africa: The Finance Minister delivered the budget for 2016 that included tax provisions.
  • Botswana: The Minister of Finance and Development Planning presented the budget proposals for the 2016-2017 year that includes provisions related to income taxation of businesses and individuals.

Americas

  • Canada: Qualifying large employers now have until 1 January 2018 before they have to start making contributions to the new Ontario retirement pension plan (ORPP).
  • Mexico: Mexican states in 2016 are expected to focus their efforts on increasing their tax revenue stream.
  • Panama: All individuals and corporations requiring a tax residence certificate from the government must file a request that satisfies the requirements of guidance issued in January 2016.

Asia Pacific

  • Hong Kong: The budget 2016-2017 was presented on 24 February, and includes tax provisions.
  • Azerbaijan: Changes to the tax law include tax exemptions for those that have obtained an “investment promotion certificate.”
  • Australia: The Treasurer announced new tax compliance requirements are being imposed with respect to foreign investment applications.
  • Vietnam: New policies for foreign workers will be effective 1 April 2016, including changes concerning exempt categories for “incoming” foreign nationals, specifically changes to the work permit rules.

Europe

  • Hungary: The Court of Justice of the European Union (CJEU) issued a judgment finding that certain aspects of leisure-card and meal-voucher plans provided by employers for certain employees are incompatible with EU law.
  • EU: The European Union and Monaco initialed a new tax transparency agreement, under which information will start being collected from 1 January 2017.

Transfer Pricing

  • India: The Delhi Bench of the Income-tax Appellate Tribunal rejected as inappropriate a functional comparability based on broad parameters that failed to explore the actual substance of the taxpayer’s business functions.

FATCA / IGA / CRS

  • Australia: Common reporting standard (CRS) legislation is expected to be passed by Parliament and would apply from 1 July 2017.

United States

  • The president signed into law trade facilitation legislation that includes a provision that makes permanent the ban on states and localities taxing internet access or placing multiple and discriminatory taxes on internet commerce.
  • Final regulations requiring “domestic entities” and individuals to report their foreign financial assets to the IRS pursuant to section 6038D.
  • Puerto Rico’s draft regulations for a value added tax (VAT) system, effective 1 April 2016.
  • Regulations concerning the compliance-monitoring duties of a state or local housing credit agency for purposes of the low-income housing credit.
  • Proposed regulations defining a “political subdivision” for purposes of tax-exempt bonds issued by state and local governments.

 

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

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