KPMG’s Week in Tax: 28 August - 1 September 2017 | KPMG | GLOBAL

KPMG’s Week in Tax: 28 August - 1 September 2017

KPMG’s Week in Tax: 28 August - 1 September 2017

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

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BEPS and Transfer Pricing

  • United States: The IRS provided a list of countries or jurisdictions that have agreed to the automatic exchange of country-by-country (CbC) reporting data.
  • Taiwan: Draft amendments to the transfer pricing rules provide for the three-tier transfer pricing documentation requirements under the OECD’s base erosion and profit shifting (BEPS) Action 13 for CbC reporting, Master file, and Local file. The amended rules are expected to apply to fiscal years beginning on or after 1 January 2017.  
  • Australia: Transfer pricing rules were among the focus of a corporate tax avoidance inquiry concerning the interaction of the Australian Taxation Office and multinational companies.

 

Read TaxNewsFlash-BEPS and TaxNewsFlash-Transfer Pricing

Europe

  • EU: Export controls and trade-related sanctions concern an expansion of EU sanctions against Russia; and a criminal prosecution in the Netherlands as result of alleged violation of Iran sanctions. 
  • EU: The deadline for filing foreign value added tax (VAT) refund claims for the calendar year 2016 is 30 September 2017.
  • Croatia: Amendments implement EU directives concerning foreign workers and work permits into Croatian law. The changes concern “posted workers,” intra-corporate transfers, and seasonal workers.

 

Read TaxNewsFlash-Europe

Americas

  • Brazil: An income tax treaty with Russia has been ratified by Brazil. The treaty includes provisions concerning permanent establishments, withholding tax rates on dividends, interest, royalties and professional services, and limitation on benefits.

 

Read TaxNewsFlash-Americas

Asia Pacific

  • China: A new measure encourages foreign direct investment by temporarily permitting the deferral of dividend withholding tax when the relevant amounts are reinvested in “encouraged” projects.

 

Read TaxNewsFlash-Asia Pacific

United States

  • President Trump gave a speech in which he broadly set out his vision for reforming the tax code, and again reiterated his support for a corporate tax rate of 15%.

 

Read TaxNewsFlash-Tax Reform

 

  • The IRS announced that section 401(k) plans and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Harvey and members of their families.
  • Because of shortages of undyed diesel fuel caused by Hurricane Harvey, the IRS will not impose a penalty when dyed diesel fuel is sold for use or used on the highway.
  • The IRS announced that taxpayers affected by Hurricane Harvey in parts of Texas have until January 31, 2018, to file certain individual and business tax returns and to make certain tax payments.
  • A Massachusetts appeals court affirmed a decision of an appellate tax board that an electric company (subject to the tax on utility corporations) that incurred a $62 million loss as a result of a 2008 ice storm, could not apply the disaster loss to a year other than the year of the disaster (unlike the federal tax treatment for disaster losses).
  • The New Jersey Division of Taxation announced that out-of-state businesses that have “click-through” nexus with the state will be offered a chance to participate in a special voluntary disclosure program.
  • The North Carolina Supreme Court held that market discount income with respect to the disposition of U.S. government bonds was not deductible interest for purposes of the state’s corporate income tax.
  • The Wisconsin Tax Appeals Commission, applying the income-producing activity test, determined that receipts from licensing the right to install and replicate proprietary software were receipts from licensing an intangible right.

 

Read TaxNewsFlash-United States

FATCA / IGA / CRS

  • Canada: Updated guidance clarifies certain aspects of the common reporting standard (CRS) and contains changes to certain CRS definitions and requirements. 
  • Singapore: A draft version of the CRS guidance is intended to assist Singapore financial institutions (and other businesses affected by CRS) in understanding the CRS framework and their CRS compliance obligations.
  • Australia: Guidance on the automatic exchange of information (AEOI) related to the FATCA and CRS regimes was updated.
  • Mauritius: The due date for the transmission of FATCA information to the tax authorities for exchange with the U.S. tax authority (IRS) was extended from 31 July 2017 to 31 August 2017.

 

Read TaxNewsFlash-FATCA / IGA / CRS

Trade & Customs

  • The U.S. Commerce Department delayed until November 2017 final determinations in its investigations concerning softwood lumber imported from Canada.
  • The U.S. State Department clarified provisions concerning Category XI (military electronics) of the United States Munitions List. 
  • The U.S. Government Accountability Office released a report on the U.S. foreign trade zone (FTZ) program and the benefits afforded companies operating in the zones by allowing them to reduce, eliminate, or defer duty payments on goods manufactured or stored in the FTZs before they enter U.S. commerce or are exported.

 

Read TaxNewsFlash-Trade & Customs

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