Article Posted date
07 July 2023
Tax developments or tax-related items reported this week include the following.
Africa
- South Africa: The South African Revenue Service (SARS) published Notice 3631 listing the persons required to submit third party returns.
Read TaxNewsFlash-Africa
Americas
- Canada: An information bulletin announced that Quebec intends to harmonize its rules with several measures included in the 2023 federal budget Bill C-47.
- Chile: The U.S. Senate voted to approve the U.S. income tax treaty with Chile, subject to two reservations, which Chile must now approve in order for the treaty to be ratified and enter into force. Once ratified, the treaty would limit certain withholding taxes and exempt certain capital gains.
Asia Pacific
- Philippines: The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 60-2023 to circularize the availability of the enhanced BIR registration forms (Nos. 1901, 1902, 1903, 1904 and 1905).
- Philippines: The First Division of the Supreme Court held that the three-year prescriptive period began running from the taxpayer’s filing of its original value added tax (VAT) return, even the taxpayer subsequently amended the return, because the amendment was not “substantial.”
- India: The Central Board of Direct Taxes (CBDT) issued frequently asked questions (FAQs) regarding the implementation of the increase in the withholding tax under the Finance Act, 2023 (from 5% to 20%, effective 1 July 2023) on purchases of overseas tour packages and foreign remittances under the Liberalised Remittance Scheme (LRS).
- India: The Bombay High Court held that capital gain on the sale of debt instruments in India was exempt from tax in India under the India-Singapore income tax treaty because such gain was fully taxable in Singapore, regardless of whether it was actually repatriated to Singapore.
- Sri Lanka: The government published the Social Security Contribution Levy (Amendment) Bill, which proposes amendments to the First Schedule (relating to exemptions) of the Social Security Contribution Levy Act, No. 25 of 2022.
- Vietnam: The Ministry of Finance submitted to the government a draft decree on the VAT reduction policy, which would generally reduce the VAT rate applicable to goods and services subject to the 10% VAT rate by 2%, to 8%.
- Australia: The Australian Taxation Office (ATO) released a series of guides on the goods and services tax (GST) treatment of digital currency transactions.
- Australia: The Federal Court held that the taxpayer did not qualify for research and development (R&D) tax incentives because, although the taxpayer successfully registered their R&D activities, it conducted significant R&D activities outside of Australia that were not covered by an Overseas Advanced Finding.
- Australia: Treasury released for consultation a draft of legislation to introduce the proposed small business energy incentive announced in the Federal Budget 2023-2024.
- Australia: The ATO released a guide on how digital game developers can claim the digital games tax offset for costs incurred in developing digital games in Australia.
- Australia: Legislation proposing changes to the interest limitation/thin capitalisation rules, broadly consistent with the exposure draft legislation, was introduced in Parliament.
- Australia: The New South Wales government published an update on various tax changes effective 1 July 2023.
- Australia: The ATO released updated guidance on the central management and control (CMC) test of residency.
Europe
- Luxembourg: The tax authority updated the FAQ on its website regarding the mandatory automatic exchange of information in relation to cross-border arrangements (DAC6).
- Poland: The Constitutional Tribunal held that the definition of “structure” under Article 1a(1)(2) of the Act on Local Taxes and Duties, applicable for real estate tax purposes, was unconstitutional.
- Spain: Spanish companies have until 30 September 2023 to file a claim—through the Spanish tax authority’s website—for the refund of VAT paid in other EU countries during 2022.
- Albania: The Albanian Parliament approved Law no. 36/2023 providing support for the creation and development of new businesses with high growth potential (start-ups) in the field of technology and innovation, which is effective 28 June 2023.
- A KPMG report prepared by the KPMG member firm in the Netherlands summarizes certain global tax-related developments that are relevant for companies involved in shipping and related industries.
Read TaxNewsFlash-Europe
Transfer Pricing
- Australia: The Australian Taxation Office (ATO) published a report with findings from its review of the advance pricing agreement (APA) program.
- Brazil: The Federal Revenue of Brazil (RFB) published a draft Normative Instruction (IN) for public consultation on the new transfer pricing rules under Law 14.596/23.
FATCA / IGA / CRS
- Ireland: The Irish Revenue Commissioners released e-Brief No. 150/23 extending the FATCA and common reporting standard (CRS) filing deadline for the 2022 reporting period from 30 June 2023 to 14 July 2023 due to filing issues with Revenue Online Service (ROS).
United States
- Proposed regulations would amend the definition of “short-term, limited-duration insurance,” amend the scope of excepted benefits coverage, and clarify the tax treatment of certain accident and health insurance.
- The U.S. Tax Court released a memorandum opinion holding that taxpayers were not entitled to a section 41 research tax credit and were liable for section 6662(a) penalties.
- The U.S. Tax Court released a memorandum opinion holding that the period of limitations for assessing tax attributable to TEFRA partnership items had expired with respect to an individual indirect partner of the partnership.
- The U.S. Court of Appeals for the Ninth Circuit reversed the Tax Court’s determination that taxpayers owed neither deficiencies nor penalties for prior tax years because partnership losses allegedly claimed on unsigned, unfiled tax returns for those years exceeded the IRS’s adjusted non-partnership deficiencies.
The items described above are also reported as editions of TaxNewsFlash:
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