Spain has deposited its instruments of ratification for the BEPS MLI Convention, thus underlining strong commitment to prevent the abuse of tax treaties and base erosion and profit shifting (BEPS) by multinational enterprises.
The Convention will enter into force on January 1, 2022, for Spain.
The MLI offers concrete solutions for governments to close the gaps in existing international tax rules by transposing results from the BEPS project into bilateral tax treaties worldwide.
The MLI now covers 96 jurisdictions.
The Council today adopted its position at first reading on the proposed directive on the disclosure of income tax information by certain undertakings and branches, commonly referred to as the public country-by-country reporting (CBCR) directive, paving the way for its final adoption. The adoption of the Council’s position follows a provisional agreement reached with the European Parliament in June.
The CBCR directive aims to enhance the corporate transparency of big multinational companies. It will require certain multinational undertakings with revenue of more than €750 million to disclose publicly in a specific report the income tax they pay. For the first time, non-European multinationals doing business in the EU through subsidiaries and branches will also have to comply with the same reporting obligations as EU multinational undertakings.
The reporting will take place within 12 months of the date of the balance sheet for the financial year in question. The directive sets out the conditions under which a company may defer the disclosure of certain information for a maximum of five years.
The proposed directive also stipulates who bears responsibility for ensuring compliance with the reporting obligation.
On September 24, 2021, the Indian Finance Ministry issued a notification extending the transfer pricing safe harbor rules.
The rules are contained in Rule 10TD of the Income Tax Rules 1962.
The extension applies for assessment years 2020-21 and 2021-22.
The Cyprus Tax Department has informed that there will be no imposition of administrative fines for overdue submission of DAC6 information that will be submitted until 30 November 2021.
The penalty will not apply in the following cases:
Reportable cross-border arrangements that have been made between 25 June 2018 and 30 June 2020 and had to be submitted by 28 February 2021.
Reportable cross-border arrangements that had been made between 1 July 2020 and 31 December 2020 and had to be submitted by 31 January 2021.
Reportable cross-border arrangements made between 1 January 2021 and 31 October 2021, that had to be submitted within 30 days from the date they were made available for implementation or were ready for implementation or the first step in the implementation has been made, whichever occurred first.
Reportable cross-border arrangements for which secondary intermediaries provided aid, assistance or advice, between 1 January 2021 and 31 October 2021 and had to submit information within 30 days beginning on the day after they provided aid, assistance or advice.
The first periodic report for marketable arrangements that had to be submitted by 30 April 2021.
On September 21, 2021, Philippine House of Representatives approved a proposal imposing a 12% tax on digital transactions in the country to generate new funding sources for the country's Covid-19 response efforts.
The Chamber passed Bill 7425 seeking to amend Section 105 of the National Internal Revenue Code (NIRC) by taxing digital service providers that operate through online platforms. The bill seeks to clarify the imposition of VAT on online advertisement services, digital services in exchange for a regular subscription fee, and supply of other electronic and online services that can be delivered through the Internet.
Albay Rep. Joey Salceda, a principal author of the bill, said foreign corporations selling digital services, such as Netflix, Spotify, and others, will have to pay for and impose VAT on their services. Digital services include online licensing or software, updates and add-ons, website filters and firewalls, mobile applications, video games and online games, and webcasts and webinars, Salceda said.
Taiwan and UK have signed a protocol to amend the tax treaty between both nations.
The protocol was signed in London on August 11, 2021, and in Taipei on August 19, 2021.
The protocol will enter into force upon completion of the procedures required by the law of both territories.
Finland has agreed on new tax measures to strengthen general government finances by a total of approximately EUR 100 million on an annual basis. The new decisions will take effect in 2022 and 2023.
To mitigate aggressive tax planning, the provisions on the limitation of deductibility of interest expenses will be reformed by restricting the application of the balance sheet exemption from the beginning of 2022 so that the provisions effectively prevent the transfer of taxable income outside Finnish taxation in private equity structures.
In addition, the transfer pricing adjustment provision will be revised from the beginning of 2022 so that it can be applied within the scope of the OECD Transfer Pricing Guidelines.
On August 30, 2021, the South African Revenue Service published the 2021 guide on taxation in South Africa.
The guide provides an overview of the most significant tax legislation administered in South Africa. The guide includes the Tax Administration Laws Amendment Act 24 of 2020, the Taxation Laws Amendment Act 23 of 2020, and the Rates and Monetary Amounts and Amendment of Revenue Laws Act 22 of 2020.
Information is included on legislations including the Income Tax Act; Securities Transfer Tax Act; Securities Transfer Tax Administration Act; Tax Administration Act; and Transfer Duty Act.
Comments on this guide may be emailed to email@example.com.