Other news in brief

A round up of other news this week.

A round up of other news this week.

On 6 May 2022, the OECD published a shorconsultation (which will close on 20 May 2022) on the regulated financial services exclusion from Amount A of Pillar One. In the accompanying press release, the OECD explained that the Regulated Financial Services Exclusion will exclude from the scope of Amount A the revenues and profits from Financial Institutions subject to capital adequacy requirements. The scope of the exclusion derives from that requirement since the regulation helps to align the location of profits with the market (the broader objective of Amount A). Thus, entities that are subject to specific capital measures (and only those, as far as this exclusion is concerned) are excluded from Amount A.

In the EU, MEPs have issued a report on the proposal for a Minimum Tax Directive. While the report generally approves the Commission’s proposal, it calls on the Commission to make several amendments. The report will be tabled for a plenary vote in the European Parliament, after which it will constitute the Parliament’s opinion on the proposed Minimum Tax Directive. This opinion will not be binding on the Council of the EU but would need to be considered by Member States when agreeing on the final text of the Directive. The Directive will next be considered by the Economic and Financial Affairs Council of the EU (ECOFIN) on 24 May 2022. No agreement has been reached at previous ECOFIN meetings and so the goal will be to try to find consensus between all 27 Member States. Refer to E-News from the EU Tax Centre for further details.

The UK and Welsh Governments have made an agreement to establish a new Freeport in Wales. Freeports are special areas within the UK’s borders where different economic regulations apply. This new Freeport is the first to be announced in Wales and follows the announcement of two new ‘Green Freeports’ in Scotland in February 2022. The UK Government had previously committed to establishing at least one Freeport in each of Scotland, Wales and Northern Ireland.

The Government is consulting on proposals that seafarers on certain ships which use UK ports be paid at least an amount equivalent to the National Minimum Wage (NMWe). These proposals would make access to UK ports conditional on operators of ‘frequent and scheduled services’ evidencing that seafarers onboard are paid at least NMWe. The Government’s current working assumption is that ’frequent’ should mean services calling at UK ports at least once per week according to a published schedule. Under these proposals, the Maritime and Coastguard agency would undertake compliance inspections with Statutory Harbour Authorities levying surcharges or, by direction from the Secretary of State for Transport, suspending port access, for non-compliance. The Consultation period runs until 7 June 2022.

Following the lifting of COVID restrictions, the Pensions Regulator has returned to carrying out on-site spot check inspections of employers suspected of failing to meet their pension automatic enrolment obligations. Employers not complying with the automatic enrolment requirements may face enforcement action including compliance notices and fines. On-site inspections will be carried out across the UK in the coming months. As well as carrying out spot check inspections, the Pension Regulator also detects non-compliance using Real Time Information payroll data shared by HMRC, information provided by pension schemes and whistleblowing reports from individuals.

Progress on climate-related disclosures in annual reports by some of the world’s leading banks slowed down in 2021, according to a new report from KPMG International Standards Group.