21 February 2014
Americas Tax Center Weekly Roundup
Latest news — Americas
US government releases last substantial regulations package to implement FATCA
On 20 February 2014, the US government released the last substantial package of regulations necessary to implement the Foreign Account Tax Compliance Act (FATCA). Treasury Decision 9657 provides final and temporary regulations regarding information reporting by foreign financial institutions (FFIs) with respect to US accounts and withholding on certain payments to FFIs and other foreign entities. Treasury Decision 9658 provides final and temporary regulations that revise certain provisions relating to withholding of tax on certain US source income paid to foreign persons, information reporting and backup withholding on payments made to certain US persons, portfolio interest paid to nonresident aliens and foreign corporations, and the associated requirements governing collection, refunds and credits of withheld amounts under these rules. A US Treasury Fact Sheet highlights the regulations package. A EY Global Tax Alert is pending.
Tax Court of Canada issues important decision on 'invoices of accommodation'
On 4 February 2014, the Tax Court of Canada (TCC) rendered a key decision in a case addressing whether the Quebec Revenue Agency (QRA) was correct in refusing a taxpayer’s claim for input tax credits in respect of Goods and Services Tax (GST) paid to certain placement agencies that had not remitted the GST to the tax authorities. The TCC concluded that the QRA’s contentions were not based on factual findings, but rather on the simple objective of recovering the taxes that had not been remitted by the fraudulent suppliers. A Tax Alert has details.
US IRS releases transfer pricing audit roadmap
On 14 February 2014, the US Internal Revenue Service (IRS) issued the Transfer Pricing Audit Roadmap, which provides best practices and helpful reference materials for certain IRS employees regarding the administration of transfer pricing audits. The Roadmap emphasizes fact gathering as a means of building a case not only for exam, but for successful litigation. Accordingly, taxpayers are well-advised to ensure that their transfer pricing documentation is robust and presents a factual picture consistent with its tax returns and financial statements. A Tax Alert has details.
OECD releases Standard for Automatic Exchange of Financial Account Information – Tax Alert now available
As we reported in last week’s Americas Tax Center Roundup, the OECD has released its Standard for Automatic Exchange of Financial Account Information. Under the Standard, participating jurisdictions would obtain information from their financial institutions and automatically exchange that information with other jurisdictions on an annual basis. A Tax Alert with details on the Standard is now available.
British Columbia budget 2014-2015 tabled
British Columbia Finance Minister Mike de Jong tabled the province’s fiscal 2014-2015 budget on 18 February 2014. The budget contains several tax measures affecting individuals and corporations. The minister anticipates a surplus of $175 million for 2013-2014, and projects surpluses for each of the next three years. A Tax Alert contains a brief summary of the key tax measures.
2014 Latin America insurance outlook
The Latin American region presents rich growth potential to competitively astute multinational and regional insurers in 2014, particularly for companies that pursue specific market niches. Overall, insurance penetration rates still remain low in many Latin American countries, particularly on the life insurance side despite continuing economic growth and reduced poverty levels. Nevertheless, significant risks remain. Learn more in EY's 2014 Latin America insurance outlook.
Spotlight on mergers and acquisitions in Mexico
The latest issue of Transactions in focus, a series from EY’s Corporate Development Network, explores Mexico, one of the world’s most dynamic emerging markets. The publication sets out the advantages and opportunities for investors in Mexico’s rapidly growing economy, as well as some of the special challenges that remain.
This week's tax treaty news in the Americas
- Canada and Bulgaria: social security agreement and related administrative arrangement enter into force
- Costa Rica and Germany: tax treaty signed
- El Salvador and Trinidad and Tobago: negotiations ongoing on partial scope trade agreement
- Mexico and Mongolia: intentions expressed to negotiate tax treaty
This week’s EY Global Tax Alerts
- German Federal Fiscal Court holds treaty override unconstitutional (19 February 2014)
- US IRS releases transfer pricing audit roadmap (19 February 2014)
- India presents 2014-15 Interim Budget (18 February 2014)
- Progress of UK consultation regarding taxation of corporate debt and derivative contracts (18 February 2014)
- India’s Delhi High Court rules that outsourcing of services by US company to Indian affiliate does not constitute PE (13 February 2014)
- Argentina issues additional regulations on the tax reform on capital gains and dividends (13 February 2014)
- Global Payroll: one year on and closer to reality? (Rescheduled: 25 February)
Is one global payroll system an achievable goal for global organizations? Or are country-specific or regionally focused models more practical? One year ago, we asked global payroll leaders in multinational organizations to share their views. Their sentiments suggested that while one universal system is a good idea in theory, it’s probably not practical. One year later, we asked this question again to see if their opinions changed. An upcoming webcast will discuss the latest global payroll study results, including core challenges, best practices and more. Register here.
- Energy reform in Mexico (26 February)
The recent Mexican tax reform will have a major impact on oil and gas companies looking to operate in and with Mexico. An upcoming webcast will discuss: (1) Mexican energy and fiscal reforms and what these mean for the sector, (2) the Mexican business environment versus other energy hubs, (3) a transactional and tax overview for operating in Mexico, and (4) opportunities and issues for oil and gas industry participants. Register here.
- 2014 EY global transfer pricing survey (27 February)
An upcoming webcast will share predictions and insights from a survey of 2,000 EY transfer pricing professionals around the world. Join us to learn more about how transfer pricing trends, issues and events worldwide could affect your global compliance, controversy and planning in 2014. Topics to be covered include: (1) transfer pricing aspects of the OECD BEPS project, (2) developing countries’ role in shaping global transfer pricing compliance, and (3) current enforcement trends in various OECD countries. Register here.
EY industry, service and issue publications
Mining and Metals
Power and Utilities
- Data privacy in the Americas-Mexico
- Data privacy in the Americas-United States
- Binding corporate rules implementation challenges
- Change management from basic privacy compliance to business strategy
- Data Privacy Bring your own device
- New grounds: big data in the health environment
- Trends in enforcement of data protection law in Europe
- EY infographic - The outlook for global tax policy in 2014
- IFRS Developments, Issue 73: IASB begins public consultation on the post-implementation review of IFRS 3
- Applying IFRS: IFRS 12 - Structured entities - considerations for fund managers