KPMG Week in Tax: June 30 – July 11, 2025

KPMG reports: Tax subtitle for “One Big Beautiful Bill” updated to reflect enactment

• California: Governor signs bill providing for single factor apportionment for financial institutions
• IRS announces tax relief for taxpayers affected by storms and flooding in Texas
• IRS revokes final rule on digital asset sales reporting
• KPMG article: Federal excise tax traps for the unwary
• KPMG article: Federal income tax implications for taxpayers constructing advanced manufacturing facilities
• KPMG article: Regulatory roadblocks to the clean fuel production credit
• Notice 2025-32: Inflation adjustment factor and phase-out for enhanced oil recovery credit
• Notice 2025-34: Reference price for section 45I credit for production of natural gas from marginal wells
• Notice 2025-36: 83 items of IRB guidance obsoleted in accordance with Executive Order 14219
• President Trump signs executive order on termination of clean electricity tax credits under sections 45Y and 48E
• Proposed regulations withdrawn: Treatment under section 382(h) of built-in gain and loss after ownership change

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Exempt Organizations

• IRS joint motion for entry of consent judgment in case challenging “Johnson Amendment”
• KPMG report: Exempt organization provisions in “One Big Beautiful Bill” as signed into law
• Senate budget reconciliation bill includes exempt organization provisions

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• Australia: Draft guidance on granting exemptions to public CbC regime
• Austria: FAQs on Pillar Two rules
• Bahrain: Guidance on advance payment of Pillar Two taxes
• Canada: Digital services tax to be repealed
• Czech Republic: Draft Pillar Two tax and information return forms, extension of deadlines
• EU: Implementing regulation to facilitate automatic exchange of tax information under DAC9
• Hungary: Direct and indirect tax amendments, including changes to Pillar Two rules
• Japan: Revised guidelines for GloBE information return, guidance on transfer pricing consequences of other jurisdictions application of Amount B
• Kuwait: Regulations under Pillar Two global minimum tax rules
• Norway: Public consultation on proposed amendments to Pillar Two rules
• UAE: Mutual agreement procedure (MAP) guidance

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• Channel Islands: Guidance on CRS and cryptoasset reporting framework (Guernsey)
• Finland: Correction of FATCA and CRS annual information returns
• Germany: Updated FATCA guidance
• Singapore: Expected amended CRS implementation timeline announced
• UK: Amendments to International Tax Compliance Regulations

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• White House issues executive order extending suspension of “reciprocal tariffs” to August 1, 2025
• U.S. final rule amending International Traffic in Arms Regulations (ITAR)
• KPMG article: How intellectual property payments impact U.S. tariffs on goods
• KPMG article: Strategic trade management in 2025—navigating and mitigating tariffs

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• Argentina: Changes to tax receipt issuance regime for VAT purposes; partial deferral of increase in tax on fuels
• Canada: Digital services tax to be repealed
• Costa Rica: Proposed increase to tax rate on fuels
• KPMG report: Global developments in ESG-related taxes, incentives, and grants (ESG tax tracker, updated July 2025)

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• Armenia: Amendments to special tax regimes
• Australia: Draft guidance on granting exemptions to public CbC regime
• Bahrain: Guidance on advance payment of Pillar Two taxes
• Bahrain: Updated VAT real estate, retail and wholesale guides
• India: Anti-fragmentation rule in definition of PE not applicable absent any business activity carried on by foreign enterprise in India (tribunal decision)
• India: Mauritius company not an Indian tax resident because control and management not situated “wholly” in India (tribunal decision)
• Japan: Revised guidelines for GloBE information return, guidance on transfer pricing consequences of other jurisdictions application of Amount B
• Kuwait: Regulations under Pillar Two global minimum tax rules
• Malaysia: Guidance on expanded sales and service tax
• Pakistan: Direct and indirect tax changes enacted in Finance Act 2025
• Pakistan: Indirect tax changes in various Provincial Finance Acts, 2025
• Pakistan: Withholding tax collection rates for tax year 2026
• Qatar: Extension of validity periods for certain tax certificates
• Saudi Arabia: E-invoicing requirement extended to 23rd group of taxpayers from March 31, 2026
• Singapore: Company did not have taxable presence merely by selling goods manufactured locally
• Singapore: Updated guidance on payments subject to withholding tax
• Sri Lanka: VAT rules for supply of services by nonresident through electronic platforms
• Taiwan: Application period extended for tax agreement benefits
• Taiwan: Proposals to expand investment tax credit incentives
• Taiwan: VAT registration threshold increased for nonresident e-service providers
• UAE: Mutual agreement procedure (MAP) guidance
• Vietnam: Guidance on invoices and documents for VAT purposes
• Vietnam: Updated VAT guidance
• KPMG report: Global developments in ESG-related taxes, incentives, and grants (ESG tax tracker, updated July 2025)

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• Austria: FAQs on Pillar Two rules
• Belgium: Proposed direct and indirect tax measures under government agreement to be presented to Parliament
• Croatia: Excise duty chargeable on basis of fictitious supply of excise goods incompatible with EU law (CJEU General Court judgment)
• Czech Republic: Draft Pillar Two tax and information return forms, extension of deadlines
• Czech Republic: Income tax changes approved by Chamber of Deputies
• Estonia: Increase in standard VAT rate effective July 1, 2025
• EU: European Commission adopts Clean Industry State Aid Framework
• EU: European Commission issues recommendations on tax incentives to support Clean Industrial Deal
• EU: Implementing regulation to facilitate automatic exchange of tax information under DAC9
• EU: Priorities of Danish Presidency of EU Council
• Hungary: Direct and indirect tax amendments, including changes to Pillar Two rules
• Latvia: Amendments to expand use of payment service providers data in tax administration approved by Parliament
• Malta: Budget law enacted including direct and indirect tax amendments
• Netherlands: Potential changes to carried interest regime as of 2026
• Norway: New consultation about imposing an e-invoicing mandate
• Norway: Public consultation on proposed amendments to Pillar Two rules
• Poland: “Look-through” approach applicable to interest and dividends; occupation of building for VAT purposes; taxation of dividends under Estonian CIT scheme
• Poland: Tax amendments passed by lower and upper houses of Parliament
• Poland: VAT amendments added to work of Council of Ministers; consultation on draft clarifications on VAT accounting rules for deposits
• Slovakia: Draft bill to amend Financial Transaction Tax Act
• Slovakia: Reduced VAT rate on state-supported rental housing approved by Parliament
• Slovakia: VAT rules clarified for leasing contracts with purchase option
• Spain: Deadline to claim VAT refund is September 30, 2025
• Sweden: Plan to temporarily increase tax support for construction industry
• UK: New HMRC enforcement campaign targets directors’ loans
• UK: Online marketplaces liable for VAT on goods sold by overseas businesses
• KPMG report: Global developments in ESG-related taxes, incentives, and grants (ESG tax tracker, updated July 2025)

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The items described above are also reported as editions of TaxNewsFlash:

• BEPS
• Indirect Tax
• Digital Economy
• Tax Controversy