10 January 2014

Americas Tax Center Weekly Roundup

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Latest news — Americas

US releases final Foreign Financial Institution Agreement for FATCA purposes

On 26 December 2013, the US government released Revenue Procedure 2014-13, which contains the final version of the Foreign Financial Institution Agreement. The revenue procedure is applicable to foreign financial institutions (FFIs) entering into FFI agreements with the US Internal Revenue Service to be treated as participating FFIs for Foreign Account Tax Compliance Act (FATCA) purposes. The effective date for the revenue procedure is 1 January 2014. A Global Tax Alert highlights certain noteworthy changes between the final agreement and the draft agreement, as well as other important unchanged provisions.

Argentina publishes new list of jurisdictions considered cooperative for tax purposes

On 7 January 2014, Argentina’s Federal Tax Authorities published a new list of the countries, jurisdictions, territories and tax systems that are considered "cooperators for purposes of fiscal transparency." The list is important as Argentina's Income Tax Law and Tax Procedure law require certain tax treatments to apply to transactions performed with individuals or entities located in jurisdictions considered tax havens. A Tax Alert provides details.

Colombia issues regulations on taxation of permanent establishments

Colombia’s Ministry of Finance and Public Credit issued Decree 3026 (27 December 2013), regulating the taxation of permanent establishments and branches of foreign entities in Colombia. A Tax Alert discusses the most relevant aspects of the new regulation.

Panama acts to repeal recently enacted law adopting worldwide income taxation system

Newly enacted Law N° 120, which amended Section 694 of the Panamanian Tax Code to adopt a taxation system based on worldwide income and abandon Panama’s traditional territorial taxation model (the Amendment), is now expected to be repealed. Law N° 120 was approved and published in the Official Gazette on 30 December 2013. The Amendment came as a major surprise to practitioners and taxpayers and generated a strong negative reaction. Accordingly, the Panamanian Government acknowledged that it was ill-advised and will be repealed by means of a new law. A Tax Alert has details .

Tax Court of Canada dismisses appeal on transfer pricing reassessment of 2003 factoring transactions

On 28 December 2013, the Tax Court of Canada released its decision in McKesson Canada Corporation v The Queen (2013 TCC 404). The case concerned a factoring financing transaction, and a related appeal addressed the Part XIII withholding tax liability assessed on the value of the dividend deemed conferred during FY2003 as a result of a transfer pricing adjustment. The court agreed with the Canada Revenue Agency’s position on the transfer pricing adjustment and the withholding tax assessment and dismissed both of the taxapayer’s appeals. A Tax Alert has details.

Puerto Rico enacts temporary property tax amnesty

Puerto Rico’s governor has signed HB 1372 into law (Law 145-2013), creating a tax amnesty to relieve taxpayers of the payment of interest, surcharges and penalties on outstanding real and personal property tax debts with the Municipal Revenue Collection Center (CRIM by its Spanish name). To administer the tax amnesty, the CRIM issued Administrative Order 2013-06, which provides procedures and establishes that the tax amnesty will run from 18 December 2013 to 27 March 2014. A Tax Alert has details.

This week's tax treaty news in the Americas

  • Canada and France: tax protocol enters into force
  • Colombia and Czech Republic: Colombian Congress approves tax treaty
  • Colombia and Portugal: Colombian Congress approves tax treaty
  • Jamaica and Norway: tax protocol enters into force

This week’s EY Global Tax Alerts

Upcoming webcasts

  • Cloud computing – a global perspective (23 January)
    Does your organization understand its global tax risks surrounding cloud-based transactions, and how the cloud tax landscape may change in the coming months and years? We invite you to join our panel of tax professionals for an informative and multinational discussion regarding the cross-border tax considerations for global cloud computing arrangements. Whether you are a cloud user or cloud service provider, this webcast will help you understand the relevant tax issues and opportunities. Register here.

Recently archived webcasts now available on-demand

  • Transfer pricing controversy in India and China – how different is it?
    Many US and Canadian multinational companies have transactions with related parties in India and/or China, where they face transfer pricing enforcement regimes and controversy procedures that differ substantially from those in North America. A recent webcast provided background on the Indian and Chinese transfer pricing regimes, including any unusual aspects of their transfer pricing rules, as well as transfer pricing audits, significant court cases, and information on their mutual agreement procedure and advance pricing agreement (APA) programs. Watch it on-demand here.