After a decade, the Treasury Department issued a new U.S. Model Income Tax Convention (the “2016 Model”), which is the baseline text the Treasury Department uses when it negotiates tax treaties (last updated in 2006). The 2016 Model includes a number of new provisions intended to more effectively implement the Treasury Department’s longstanding policy that…
When the EU Anti Tax Avoidance Package was launched by the European Commission, a Study on Structures of Aggressive Tax Planning and Indicators was released simultaneously as Taxation papers – Working paper N. 61- 2015, which is available: here. Reading the Study provides a good basis for understanding the reasoning behind the Anti Tax Avoidance…
Model tax treaties do matter. The OECD and UN Models constitute precedent books with standard clauses that contracting states can follow or adapt to suit their particular circumstances. The US Model treaty, in contrast, is a statement of intent. The preamble to the revised 2016 US Model Income Tax Convention released by the US Treasury…
(“Every in-house tax department should have their own IT/Financial systems capacity” – JHM, TP Minds London, 2015.) The unexpected benefit from country by reporting (“CbyC”) reporting is that tax departments may learn something about their own groups’ financial systems. What is there to learn? If you are in-house, answer these four questions: 1. Do you…
MNC profit shifting has received major attention over the past few years. Total earnings stockpiled overseas are now reported to be in excess of $2 trillion. One of the authors published a technical tax article in Tax Notes on July 13, 2015, demonstrating that foreign subsidiaries of many MNCs are highly vulnerable to IRS attack using an…
(about the switch-over clause in the ATA Directive) In order to combat BEPS, the European Commission is proposing to start taxing low taxed non-EU income. That sounds reasonable, but the consequence will be that in the EU, there will be no more profits to tax. This is a proposal that is not necessary to prevent…
On 28 January 2016, the European Commission issued its proposal for a Council Directive dealing with tax avoidance practices within the EU – the so-called Anti-BEPS Directive. The context of the proposal is well known: in a nutshell, the proposal results from the dual influences of the (thus far) failed 2011 CCCTB proposal and the…
I. Introduction Shall international tax planning decrease after the implementation of BEPS? The reply is “depends” by virtue of the subject’s exposure to several variables. Obviously, one should consider the question in the light of the legislative framework and tax environment of the relevant country which is in principle the country for which tax planning…
The IRS issued Notice 16-08 announcing that it will extend timelines or modify four elements of FATCA – (1) modify the date for submitting to the IRS the preexisting account certifications required of certain foreign financial institutions (FFIs); (2) specify the period and date for submitting to the IRS the periodic certification of compliance for a registered deemed…
In 2015, people around the globe celebrated the 800th anniversary of the Magna Carta Libertatum, considered to be the first constitutional-like document that established restrictions on a sovereign’s basically unlimited power. The principle of “no taxation without representation” has its origins in this British document of 1215. The symbolic relevance of the Magna Carta has…
The Indian Ministry of Finance released last month draft guidance on applying the “place of effective management” (POEM) test to determine tax residence of companies. The guidance came almost eight months after the Government substituted, through the 2015 Finance Act, the existing “control and management” test with the universal concept of POEM in Section 6(3)…
On January 15, 2016, in a joint (bi-partisan) letter of Senate Finance Committee Republicans and Democrats to US Treasury, one that will certainly be of interest to our friends at Wolters Kluwer (a Netherlands parent multinational enterprise), the Senate Finance Committee members encouraged Treasury to use a tit-for-tat strategy against the EU Commission. The letter stated that…
Interest and penalty regimes place a high premium on correctly identifying the existence of a permanent establishment in the territory of a state. The failure to do so often means that there is no reporting to the tax administration by the foreign enterprise by way of registration or filing of returns. This is particularly true…
Volume 44 (2016) Issue 1 contains: EDITORIAL Ana Paulo DOURADO, ‘May You Live In Interesting Times’ Abstract: In the current global tax good governance context, exchange of information is one condition for the BEPS initiative to be successful. Action 5 (Counter Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance) foresees mandatory spontaneous…
