19 July 2013
Americas Tax Center Weekly Roundup
Latest news — Americas
OECD releases Action Plan on Base Erosion and Profit Shifting (BEPS)
The OECD today released its “Action Plan” describing the specific focus areas for the next phase of its project on addressing base erosion and profit shifting. Following up on the OECD’s initial BEPS report issued in February 2013, the Action Plan sets forth the work that the OECD will do in 15 areas of international tax law and practice. The Action Plan includes deadlines for the action areas that range from September 2014 through December 2015. It identifies the expected OECD output in these action areas as including OECD reports and analyses, changes to the OECD transfer pricing guidelines, changes to the OECD model tax treaty, OECD recommendations for domestic law, and development of a multilateral treaty approach. An EY Breaking Tax News Alert has additional information. A detailed Tax Alert is forthcoming.
US revises timelines and provides other guidance on FATCA provisions
On 12 July 2013, the US Internal Revenue Service announced (Notice 2013-43) a delay of key timelines for implementing many of the Foreign Account Tax Compliance Act (FATCA) provisions affecting withholding agents, foreign financial institutions (FFIs) and non-financial foreign entities. The Service also provided updates on the FATCA Portal, which will be used by FFIs to enter into FFI agreements and/or register for FATCA purposes, and by all withholding agents to verify Global Intermediary Identification Numbers provided to them by FFIs. Additionally, it addressed the treatment of FFIs located in jurisdictions that have signed intergovernmental agreements with the US during the period when those agreements are not yet in force. A Tax Alert has details.
Peru amends transfer pricing documentation requirements for resident taxpayers
Superintendence Resolution No. 175-2013/SUNAT amends the transfer pricing documentation requirements applicable to resident taxpayers in Peru. The most significant change is the new obligation to submit the actual transfer pricing study to the Peruvian Tax Administration alongside the transfer pricing informative return. In previous years, taxpayers had to keep the transfer pricing study in case it was requested during the tax audit. In addition, a new transfer pricing informative return was approved. A Tax Alert has details.
Canada issues draft technical amendments on foreign affiliates and other measures
On 12 July 2013, Canada’s Department of Finance released draft legislation containing a range of proposed amendments to the federal Income Tax Act and Income Tax Regulations applicable mainly in relation to investments in foreign affiliates. Many of the proposals respond to issues taxpayers and their representatives have brought to the Department’s attention. Various effective dates would apply. A Tax Alert describes the most significant elements in the proposals.
Canada revises transitional measures on character conversion transactions
On 11 July 2013, Canada’s Department of Finance released revised transitional measures applicable to the “character conversion” rules that were proposed as part of the 2013 federal budget. Character conversion transactions involve certain financial arrangements that link a derivative investment with the purchase or sale of an otherwise unrelated capital property to form a derivative forward agreement. Under the new rules, the taxpayer’s return on such an arrangement would get income account, rather than capital account, treatment. A Tax Alert has details.
Global oil and gas tax guide 2013is now available
EY’s annual Global oil and tax guideprovides information about oil and gas tax regimes in 74 countries. The guide can help businesses implement local tax legislation, which varies greatly from general corporate tax regimes. It reports that development of unconventional oil and gas — shale oil and gas, in particular — is economically possible under current oil prices and many countries are working on altering their fiscal framework to provide incentives for such projects.
EY Canada discusses integration in the tax system, tax governance and GAAR
TaxMatters@EY,a monthly bulletin prepared by EY Canada, provides a summary of recent Canadian tax news, publications and resources. The latest edition discusses integration in the Canadian tax system, findings from a recent Canadian tax governance survey, and a recent Tax Court of Canada decision that discussed the pertinent principles to be applied when analyzing the application of the general anti-avoidance rule (GAAR).
EY global barometer report aimed at CFOs says it’s time for action
EY’s latest Global Capital Confidence Barometer – The CFO Perspective suggests that chief financial officers (CFOs) should be looking to help their organizations seize first-mover advantage in the mergers and acquisitions market. According to the article, the world economic outlook is improving and credit availability is high, so the challenge for the CFO is to help realize the current potential in the market and prevent the risk aversion of recent years from turning into stagnation.
2013 International Estate and Inheritance Tax Guideis now available
EY's 2013 International Estate and Inheritance Tax Guidesummarizes the estate tax planning systems and describes wealth transfer planning considerations in 36 jurisdictions, including Brazil, Canada, Mexico and the US. Its information and guidance will be useful to owners of family businesses and private companies or managers of private capital enterprises, as well as the executives of multinational companies and other entrepreneurial and internationally mobile high net worth individuals.
This week’s Global Tax Alerts
- Canada releases transitional measures regarding character conversion transactions (18 July 2013)
- CFC income from software leases determined to be foreign personal holding company income (18 July 2013)
- Russia extends release from withholding tax obligation on interest from Eurobonds (17 July 2013)
- Canada issues draft technical amendments on foreign affiliates and other measures (17 July 2013)
- Philippines and Thailand sign new income tax treaty (16 July 2013)
- Luxembourg expands tax treaty network (16 July 2013)
- Notice 2013-43 revises timelines and provides other guidance on FATCA provisions (15 July 2013)
- Malta enhances participation exemption to apply to branch profits (15 July 2013)
- Russia enacts measures to combat illegal financial operations (12 July 2013)
- Peru amends transfer pricing documentation requirements for resident taxpayers (12 July 2013)
- Italy approves new nonresident forms for mitigation of withholding taxes (12 July 2013)
- Hong Kong enacts new law to enter into standalone tax information exchange agreements (12 July 2013)
- Spanish tax authorities issue ruling on cancellation of debt income (11 July 2013)
- Italy to issue decree on tax migration of companies (11 July 2013)
- French Tax Authorities issue draft guidelines on migration of corporate headquarters or establishments (10 July 2013)
- Uruguay proposes repeal of capital gains tax exemption on transfer of bearer shares (10 July 2013)
- Mumbai appellate Tribunal rules on dependent agency permanent establishment (10 July 2013)
- Vietnam-Serbia Income Tax Treaty ratified by Serbia (10 July 2013)
- Vietnam Tax Authorities increase Transfer Pricing enforcement activities (10 July 2013)
- China issues draft revisions to Tax Collection and Administration Law (9 July 2013)