According to an undisclosed policy paper that is currently circulated within the OECD, the German government is promoting an internationally coordinated reform of corporate taxation. Specifically, Germany proposes an effective minimum tax on the profits of multinational companies. Complex, easy to manipulate and unfair – there is widespread discontent with the current system of international…
As we approach the halfway mark between the 2018 IFA conference in Seoul and the 2019 one in London, I want to clear up some issues around “Business” as in stakeholders in tax discussions. Classically these stakeholders are “Government”, “Academia” and “Business” (plus the last 10 years “Civil society”). So, who should “Business” be? Setting…
The Italian Stability Law for 2019 finally approved on 30 December 2018 has introduced a new art. 24-ter in the Income Tax Act (ITA). It includes a substitute tax of 7%, in lieu of ordinary taxation, on all non-Italian-sourced income earned by foreign pensioners transferring their tax residence in the southern regions of Italy. The…
For thousands of years the human species was constrained to limit its activities and creativity in the planetary space. Today, the Digital Revolution has opened a new space: the cyber-space, removing the limits once and for all. Cyber-space is understood as a virtual world, a notional environment existing in and due to the network of…
Transfer pricing cases in India are estimated to account for more than half of the world’s transfer pricing disputes. Prolonged transfer pricing litigation due to overburdened courts and tribunals is a sad reality for many companies doing business in India. The consequence is that a cloud of uncertainty constantly hangs over cross-border, intra-group transactions routinely…
Intertax issue 12 is available and I am delighted to share with the reader the topics dealt with in the issue. In my editorial, “Taxes and Competiveness: How Much Competitive Is European Tax Competition?”, I critically address some of the topics discussed on the Platform for Tax Good Governance at its meeting after the summer…
On 30 August 2018 the OECD released the fourth round of BEPS Action 14 peer review reports on improving tax dispute resolution mechanisms. Included in this round was a report on Australia. The report concluded that Australia meets part of the elements of the Action 14, and in particular meets some of the requirements regarding…
I am delighted to share the contents of Intertax issue 11 with our readers. My editorial entitled “Profit Splitting and the Aspirational Arm’s Length Principle” discusses the (in)adequacy of the arm’s length principle, mainly or almost exclusively based on comparable transactions among unrelated parties, in cases where comparable transactions do not exist, in order to…
Following three years of investigation, McDonald’s has been cleared from the charge that it received fiscal state aid from Luxembourg, by virtue of the European Commission’s concluding decision of 19 September 2018. Thus, the Commission seems to have closed one of the various fronts opened in the fiscal state aid area in the last five…
VAT is a broad-based tax on final consumption by households. Even if, due to the invoice-credit mechanism through which the tax is normally levied, only final consumption is ultimately targeted, VAT uses each transaction taking place at every stage of the production and distribution process as taxing points. Depending on how a transaction is classified,…
By now, warranty & indemnity (W&I) insurance is more or less a transaction solution commodity. As such, it clearly has entered its next product life-cycle phase. Expectations are that stand-alone tax insurance will quickly follow suit. As W&I insurance has grown in popularity, tax insurance has been most often used as an add-on to W&I insurance to provide…
Almost every foreign client I have advised has at some stage told me how complex the Indian Income Tax Act is. And those who follow Indian tax jurisprudence closely know that judicial decisions, in many cases, are doubly complex. Recently, India’s Income Tax Appellate Tribunal (ITAT), New Delhi was asked to decide if the tax…
If the BEPS Project is considered formally concluded with the signature of the Multilateral Instrument, the war against base erosion and aggressive tax planning is still ongoing, with many battles remaining to be won. In this context, each and every transaction that can potentially serve aggressive tax planning is key target for policy-makers at the…
It is common to face resistance in MAP application, which is essentially based on misconception of Double Taxation Conventions (DTCs). As Article 9(1) establishes the arm’s length standard, which presents a range of possible prices, that misunderstanding may imply more economic double taxation. Given the Brazilian position on recent transfer pricing changes, these problems become…
