4 October 2013
Americas Tax Center Weekly Roundup
Latest news — Americas
US government shutdown begins as Congress fails to reach funding agreement
A shutdown of the US federal government began on 1 October 2013 when the US Congress failed to reach a compromise on a continuing resolution to extend government funding by the 30 September 2013 deadline. The impasse stems from a disagreement between the Republican-controlled House of Representatives and Democrat-controlled Senate over whether to attach to the funding bill amendments to President’s Obama’s 2010 health care law . Certain vital governmental operations will continue through the shutdown, including some functions related to tax enforcement, as described in the Internal Revenue Service’s shutdown plan. Tax filing deadlines remain in effect.
Brazilian Normative Instruction may affect taxes due to IFRS conversion
On 17 September 2013, the Brazilian Revenue Service issued Normative Instruction nr.1,397 (NI 1,397), introducing relevant interpretations regarding the Transitory Tax Regime, which might have significant tax effects for Brazilian companies. NI 1,397 addresses the impact on tax regulations of Law nr. 11,638/2007, which significantly changed the Brazilian Corporations Law to align Brazilian accounting principles and standards to the International Financial Reporting Standards (IFRS). NI 1,397 will have a major effect on ECF (Escrituracao Contabil Fiscal – tax accounting records), dividend distribution, equity pick-up, interest on net equity and thin capitalization rules. A Tax Alert comments on these effects and what the companies should do next.
EY's Indirect Tax Briefing highlights recent indirect tax developments around the world
The September 2013 issue of EY’s Indirect Tax Briefingis now available. In addition to the regular snapshot overview of recent and upcoming indirect tax changes around the globe, this issue contains articles on EU VAT compliance, OECD VAT guidelines, managing indirect taxes in rapid growth markets and more. Country updates address, among other topics, Brazilian ICMS (state VAT) reform and customs valuation of related-party sales in Peru.
Global IPO activity slows in third quarter of 2013 but set for uplift in coming months
Global Initial Public Offering (IPO) activity fell in Q3 2013, with projected activity set to reach nearly 200 deals with IPO proceeds of around US$24.4b, according to EY’s latest quarterly Global IPO Trends Report. Based on the projected Q3 2013 totals, global IPO activity is expected to be down 4% in terms of deal numbers and 47% in terms of deal value, compared to Q2 2013. For the first nine months of 2013, around 566 IPOs are expected to raise US$94.8b.
First edition of new EY global survey of Financial Services sector available
The inaugural release of EY's Global financial services transaction monitor is now available. The semiannual publication, covering issues and trends around dealmaking in the global financial services sector, provides an overview of first-half 2013 transaction activity via dedicated sections — broken out both globally and for six geographic regions — on banking and capital markets, insurance and asset management.
Take advantage of EY's Global Tax Guides app
The EY Global Tax Guides app electronically delivers thousands of pages of tax technical content, allows the user to quickly send an email that shares a particular page of a tax guide or Global Tax Alert without leaving the app, and enables browsing offline the detailed country-by-country descriptions of tax regimes in corporate tax, transfer pricing, personal tax, indirect tax and estate tax. Each Global Tax Alert is published within 72 hours after important tax news breaks, providing a real-time view of the tax landscape. Access the app in the Apple Store.
This week's tax treaty news in the Americas
- Canada and Ivory Coast: negotiations concluded on foreign investment promotion and protection agreement
- Costa Rica, El Salvador and EU: trade agreement becomes operational
- Ecuador and China: tax treaty submitted for ratification
- Ecuador and South Korea: tax treaty ratified
- Guatemala and Thailand: intentions expressed to negotiate investment protection agreement
- Panama and UK: tax treaty approved by National Assembly of Panama
- Uruguay and Luxembourg: social security agreement approved
This week’s Global Tax Alerts
- US Supreme Court agrees to hear Quality Stores case on whether severance is subject to FICA (2 October 2013)
- Brazilian Normative Instruction 1,397 may affect taxes due to IFRS conversion (1 October 2013)
- India's CBDT issues rules for application of GAAR (30 September 2013)
- Indonesia provides temporary tax payment relief (30 September 2013)
- EU Commission invites comments by 7 October 2013 regarding its decision on Spanish financial goodwill tax amortization (26 September 2013)
- Asia Region Funds Passport Pilot; opportunities for Australian asset managers and diversification (26 September 2013)
- Russian Duma passes in third reading draft law on tax and customs regime for offshore hydrocarbon extraction activities (26 September 2013)
- French Government releases draft Finance Bill for 2014 (25 September 2013)
- Canada Revenue Agency issues 2012-13 APA Program Report (25 September 2013)
- Managing incentives in rapid-growth global markets (10 October)
What’s the best way to identify, obtain and manage grants and incentives in rapid-growth markets? How can clients build an incentives framework that allows their organization to avoid unnecessary costs and risks while maximizing the opportunities available? Do clients know how economic developments might affect government policies for incentives? In an upcoming external webcast, an experienced EY global panel will discuss insights on how managing grants and incentives can help companies enter new markets, improve margins and increase their return on investment. Register here.
- Managing VAT/GST in rapid-growth markets (24 October)
Are you concerned about managing value added tax (VAT) and goods and services tax (GST) in rapid-growth markets? What impact could tax reforms have on your plans? Do you want to avoid unnecessary costs and risks while maximizing the opportunities available to your organization? An upcoming webcast will explore the VAT and GST landscape and look at how companies can manage indirect taxes more effectively. The webcast will discuss the latest economic developments, their potential impact, and ways of operating more effectively. Register here.
EY industry, service and issue publications
Power and Utilities
Strategic Growth Markets