22 November 2013
Americas Tax Center Weekly Roundup
Latest news — Americas
Brazil revokes Transitional Tax Regime and makes other significant changes to tax system
As we reported in last week’s Americas Tax Center Roundup, Brazil’s Federal Government published Provisional Measure No. 627 (PM 627) on 12 November 2013. PM 627 contains a long expected set of rules that not only revoked the Transitional Tax Regime but added new rules aimed at permanently aligning the Brazilian tax system to the accounting model set forth by Law 11,638/2007. PM 627 also established new tax rules on the treatment of foreign profits accrued abroad by legal entities and individuals resident or domiciled in Brazil. A Tax Alert with details is now available.
Peru amends income tax regulations
Peru’s Department of Economy & Finance has introduced several amendments to the Income Tax Regulations, effective 7 November 2013. The amendments affect the joint responsibility of related parties in the transfer of Peruvian shares, valuation and cost basis in the indirect transfer of Peruvian shares, the cost basis rules for certain securities, and a mechanism to allocate passive income generated in MILA (Integrated Stock Exchange Market) by a controlled foreign corporation individual resident owner. A Tax Alert has details.
Colombia proposes postponing to 2015 scheduled reduction of financial transactions levy
During a jointly held session on 30 October 2013, the third and fourth permanent economic Constitutional commissions from both the Colombian Chamber of Representatives and the Senate approved, on first debate, a bill that would postpone a scheduled reduction of the levy on financial transactions. If approved, the levy rate would remain at 4x1000 for FY 2014 and decrease to 2x1000 in 2015. The bill is pending for approval in the plenary sessions, following the legislative procedure necessary to be incorporated as law. A Tax Alert has details.
Brazil – Turkey tax treaty takes effect
The Brazilian President issued Decree n. 8,140 on 14 November 2013, putting into full effect the Tax Treaty between Brazil and Turkey. The Treaty, which is the first tax treaty between the countries, was signed in December 2010 and had already been approved by the Brazilian National Congress. To a large extent, the Treaty’s contents are similar to those previously negotiated by Brazil, such as using a credit mechanism instead of exemption to avoid double taxation. Another highlight is that the Treaty protocol states that each country may use its own controlled foreign corporation and thin capitalization rules so that it shall not conflict with the Non-Discrimination clause of the Treaty.
OECD plans tax information superhighway
As financial institutions work toward the implementation of the US Foreign Account Tax Compliance Act (FATCA), they should be aware that automatic information exchange is not going to be a US-only phenomenon. In April 2013, the G5 (France, Germany, Italy, Spain and the UK) agreed to develop and pilot a multilateral automatic tax information exchange. In their announcement they called on other EU Member States to join the pilot; since April 2013 over 30 countries are known to have endorsed this plan. A Tax Alert has details.
Canada’s TaxMatters@EY – November 2013 issue available
TaxMatters@EY, a monthly bulletin prepared by EY Canada, provides a summary of recent Canadian tax news, publications and resources. The November 2013 issue takes a look at the benefits and potential pitfalls of tax loss selling, mitigation of the payment of tax on unpaid interest where collection is in doubt, the OECD’s request for input on country-by-country reporting, how tax reporting requirements are becoming more stringent, and a recent Tax Court of Canada decision on the importance of a director’s resignation date.
Inaugural Americas edition of EY’s Capital Insights released
The first "Americas edition" of EY’s Capital Insights is now available. This quarterly magazine seeks to help businesses manage their capital agenda by examining the latest developments around raising, investing, preserving and optimizing capital. Each edition features analysis, trends and commentary around managing capital in the current economic and regulatory environment, and provides first-hand insights from business leaders. The latest issue includes, among other items, an article on how reforms and investments are transforming Mexico and the implications for corporate dealmakers.
This week's tax treaty news in the Americas
- Barbados and San Marino: tax treaty enters into force
- Ecuador and Korea: tax treaty enters into force
- Mexico and Italy: tax treaty protocol ratified
- Mexico and Panama: third round of negotiations on free trade agreement
- Panama and UK: tax treaty ratified
- Paraguay and Spain: first round of negotiations on tax treaty
- US and Vietnam: tax treaty negotiations to take place
This week’s EY Global Tax Alerts
- French National Assembly adopts draft 2014 Finance Bill and French Government releases draft Amended 2013 Finance Bill (20 November 2013)
- Portugal amends Debt Securities Tax Exemption Regime (20 November 2013)
- India's Madras High Court rules payment for dedicated bandwidth is royalty (20 November 2013)
- Russia introduces changes in the taxation of income on securities and interest expense deduction (18 November 2013)
- Vietnam releases new Decree on tax penalties (18 November 2013)
- Hong Kong Court of Final Appeal rules unrealized revaluation gains on listed securities held for sale as nontaxable (18 November 2013)
- Belgian Tax Authorities grant extension for capital increase under transitory regime for liquidation bonuses (18 November 2013)
- Russia enacts use of cadastral value of real estate for calculation of corporate property tax base (15 November 2013)
- India's Mumbai Tribunal rules on eligibility of a Danish fiscally transparent partnership for tax treaty benefits (15 November 2013)
- OECD holds public consultation on BEPS-related reporting and transfer pricing issues (14 November 2013)
- Italy's Supreme Court holds seller's market is used to determine fair market value (14 November 2013)
Upcoming EY webcasts
- Your talent in motion: Global mobility effectiveness survey 2013 (5 December)
Global organizations now deploy their talent around the world, around the clock – in structured assignments, in flexible work patterns, in ad hoc business travel and in short-term crisis management roles. This webcast will examine how the individuals in the global talent pool, and the organizations they work for, can both benefit from effective practices in the management of global mobility. Register here.
- Business tax services: global tax update (12 December)
Looking to gain insight on recent global tax trends and developments impacting your organization? Then join our panel as we discuss key issues, such as: (1) tax policy and controversy trends and developments, (2) research and development credits and incentives, and (3) fixed and capital asset matters, including the recently issued Tangible Property Regulations in the US. This webcast will be of interest to tax professionals, tax directors and chief financial officers. Register here.
Recently archived webcasts now available on-demand
- Managing international trade in rapid-growth markets
Are you concerned about managing customs and international trade issues in rapid-growth markets? Do you want to avoid unnecessary costs and risks while maximizing the opportunities available to your organization? A recent webcast could help your organization: (1) manage or reduce customs duties and the cost of doing business internationally when trading in and with the world’s fastest-growing economies and (2) consider the latest economic developments and their potential impact on tax policy. Watch it on-demand here.
- Mexico’s new tax reform package – what you need to know
Mexico’s recently approved tax reform package could have a significant tax impact on all multinationals operating or investing in Mexico. A recent EY Thought Center webcast covered highlights of the final proposal as approved – including increased income tax rates on earnings, a broadened tax base, and changes to the maquiladora regime. Watch it on-demand here.
- Transfer pricing in transactions: the current state of play
Tax authorities around the world continue to increase the scrutiny of transfer pricing, and one of the main triggers for transfer pricing examination is a business restructuring. Nonetheless, businesses restructurings may be necessary to lower costs, improve supply chain efficiency and pursue new opportunities – despite the potential exposure to transfer pricing examination. Further, acquisitions and spin-offs trigger the same kinds of transfer pricing decisions. Our latest BorderCrossings webcast focused on all aspects of transfer pricing in transactions. Watch it on-demand here.
EY industry, service and issue publications
- The growth of hedge fund-backed reinsurers
- Leases re-exposed: the impact on banks (BANKING)
- EY - 2013 global hedge fund and investor survey
- Introducing the AIFMD-in-a-box toolkit
Oil and Gas
- International GAAP: oil and gas financial statements
- Authorized access: uncovering insider threats within oil and gas companies
- Cash in the barrel 2013
- Oil and gas capital confidence barometer 9th edition
Power and Utilities
- Capital Confidence Barometer - Power and Utilities - November - 2013
- Securing utilities against cyber attacks
- Take the COO challenge
- The capability crunch
- 5 Insights for executives - Looking at the deal through an unfiltered lens
- 5 Insights for executives - Marketing’s two-headed beast
- 5 Insights for executives - Driving healthy growth: proactive compliance
- 5 Insights for executives - Don’t let risk weigh you down