By KC Chia, KC Chia & Noor
“Journey of a thousand miles begins with a single step […] It does not matter how slowly you go as long as you do not stop.” Confucius - The Malaysian government will follow in the footsteps of more than 160 countries worldwide by implementing the Goods and Services Tax (GST), which will become effective from 1 April 2015, giving a lead time of approximately nine months for businesses in Malaysia to prepare and comply.
By Aditya Kumar, Ashwani & Associates
The current indirect tax structure is the major impediment to India’s economic growth and competitiveness. Tax barriers in the form of CST, entry tax, and restricted input tax credit (credit) have fragmented the Indian market. Cascading effects of taxes on cost make indigenous manufacture less attractive. Complex multiple taxes also increase the cost of compliance.
By Paul Malin, Haines Watts
HM Revenue & Customs (HMRC) in the UK are continuing their fight against all forms of tax evasion and aggressive tax avoidance. HMRC’s track record in this area is at best mixed but this may now be changing to their advantage.
By José Carreras Benitez, Integroup S.C.
The Mexican economy is and has consistently been growing as a result of the rapid expansion of the middle class due to education and the maturing of Mexico as an economic powerhouse. Companies from Europe and the USA are investing billions of dollars into the Mexican economy. Mexican government knows that global businesses are coming and the Base Erosion and Profit Shifting (BEPS) Action Plan suggestions have been implemented in order to protect the tax system as well as giving same protection to the Mexican partners of the Organisation for Economic Co-operation and Development (OECD). Below is a brief description of one of them:
By Oliver Biernat, Benefitax GmbH
High-income earners working for several entities of international groups in different countries may profit from a salary split. Normally the salary is paid in the home country only and the involved group countries split or reimburse the costs among each other. An interesting alternative is to have several labour contracts with each respective group company the employee works for on a regular basis (salary split).
On 1st May a Royal Decree was published, implementing incentives for companies establishing their international headquarters (IHQ) and international trading centres (ITC) in Thailand. The idea behind the scheme is to attract businesses to establish their headquarters or a trading hub in Thailand, thus bringing more tax revenues, skilled jobs and know-how to the Land of Smiles.
By Graham Busch, Lawrence Grant
Corporation Tax Rates
The main rate of Corporation Tax will fall from 26% to 25% from April 2012, 24% from April 2013 and 23% from April 2014. The small companies' rate remains at 20%.
By Fabio J. Guzmán Ariza, Guzmán Ariza
Dominican tax law is mainly territorial: taxes are collected on income from Dominican sources or on income received by Dominican residents from sources abroad. The Dominican Constitution treats foreign and local investors equally under the law.
By Ashish Bairagra, PeriGrow Consulting
Since 2012, India has been levying tax on transactions which involve transfer of shares or interest in a foreign entity, if it derives its value substantially from assets located in India (the Vodafone controversy). However, there was ambiguity about the term substantially.
By Carina Langegger, Prodinger & Partner
The question that frequently arises when multi-national corporate groups work on projects across several borders is: Which country has the right of taxation?
By Eric Longley & Harold Peterson, Prager Metis International LLC
The text of the OECD Model Tax Convention is closely followed by most international tax treaties. In doing so it provides consistency of approach removing the need for recourse to the competent authority rules where there is a dispute as to interpretation between taxpayers and domestic tax authorities. Even so there are still interpretational issues that can aid and/or trap the unwary or uninitiated.
By Artur Plutowski, EFS Group Sp.z.o.o.
Last year the European Court of Justice (ECJ) issued a judgement in case DFA Investment Trust Company vs. the Head of Tax Chamber in Bydgoszcz (C190/12). Generally, the case concerned investment funds benefiting from exemption in income tax (CIT). In particular, it referred to whether such exemption may depend on where the registered office of the investment fund is located.
By Stefano Loconte and Emanuele Tozzi
With effect from 1 January 2016 (for calendar year taxpayers) Italian enterprises with a foreign permanent establishment can opt for the branch exemption regime (Art. 14, Legislative Decree no. 147/2015). Under this optional regime the income attributable to the foreign branch will be treated as tax exempt income in Italy. Of course, in case of a tax loss, it will not be deductible from the taxable income of the head office.
By Andrea Enrico Maria Eliseo and Prof Stefano Loconte, Loconte & Partners
In addition to the aesthetic return generated by art, there are many good reasons to consider art as an attractive asset class in terms of long-term investments. Art retains value and generates moderate real return, which is why art and collectible assets represent sizable assets for many high net worth individuals (HNWIs).
By Lodovico Comploj and Martin Lechner, Pichler Dejori Comploj & Partner
In order to prevent an infringement of the European principles of non-discrimination and freedom of establishment, the Italian government introduced important changes to the domestic tax consolidation rules.
Lawrence Grant, Chartered Accountants were recently successful in recovering GBP 50k in input VAT that was deducted by French VAT authorities, after the VAT was held by the French VAT authorities for almost one year.
By Prof. Robert Anthony, Anthony & Cie
Wealth tax 2011
Only taxpayers possessing assets over M € 1.3 have an obligation to declare and to pay Wealth Tax (on September 30th, 2011). Wealth tax 2012: As from 2012, a new tax threshold at two levels is established, applicable from the first euro:
- 0.25 % for assets between M € l.3 and M€3
- 0.5 % abov
By Sergio Guerrero Rosas, Guerrero y Santana, S.C.
After receiving the opinion of the Commission of Finance and Public Credit, last month the Mexican Congress approved the economic package proposed by President Peña Nieto on 8 September 2013. The package includes substantial amendments to, as well as the repeal and enactment of, various tax laws. The objective of the proposal is to generate employment and support the economy through a counter-cyclical effort. However, no programmes have been created or launched to stimulate investment or employment.
By Sergio Guerrero Rosas, Guerrero y Santana, S.C.
President Peña Nieto’s controversial “sugar tax” was brought into force a year ago, targeting high calorie foods to the tune of 8% of their value. While the jury is still out as to whether it has had the desired effect on the population and the various burdens, what has become an issue of far greater significance is the success or otherwise of the more substantial reform package to which the sugar tax belonged.
By Carina Langegger and Manfred Leitinger, Prodinger & Partner
The ECJ decision issued on 22 April 2010 (Case C-539/08) regarding intra-community acquisitions between and Facet BV/Facet Trading BV showed that small formal invoicing mistakes can have significant implications for tax. The consequence of a purchaser using a VAT ID differing from the VAT ID of the country where the supply ends is that the purchaser becomes liable for VAT in both countries (where the supply ends and in the country of the VAT ID which was used). However, the right of VAT deduction would only be granted in the country where the delivery ends.