Sign up to save your podcasts
Or
Share Deloitte Asia Pacific Dbriefs Bytes
Share to email
Share to Facebook
Share to X
Share to email
Share to Facebook
Share to X
Or
Deloitte Asia Pacific Dbriefs Bytes
Deloitte Asia Pacific Dbriefs Bytes episodes
- 28 March 20141. BEPS• OECD issues discussion draft on Action 1 (digital economy)• No specific proposals• First key point: BEPS planning, in the digital economy, will be significantly impacted by all the other Actions in the BEPS Project• Second key point: but that will not be sufficient – something more fundamental would need to be done• Potential options for "fundamental change"- Article 5(4): trim or delete- "Significant digital presence" / "fully dematerialized digital activity" (FU-DDA)
- "Virtual PE"- Withholding tax on digital transactions- VAT: exemptions on imports of low valued goods, and inbound B2C transactions• To obtain a copy of the discussion draft, visit www.deloitte.com/ap/dbriefs/bepscentral2. Australia• Carbon tax and mining tax• Protective legislation regarding abandoned measures• ISAPS: 86 multinationals• Debt vs. equity paper• David Bradbury• For information:3. India• Bharti Airtel case: TP legislation does not apply to corporate guarantee without a fee• APAs: first batch• Nokia: US$394 million tax assessment for State VAT• For information:4. Philippines• CS Garment case• Taxpayer takes advantage of amnesty program in regard to tax assessment under litigation• For information:5. In brief• Treaty developments: China / Ecuador enters into force, and Hong Kong / U.S. sign tax information exchange agreement• New Zealand: Interpretation Statement on tax residency- For information:Teresa Farac (Auckland): [email protected]26 min - 21 March 20141. BEPS: discussion draft on Action 6 (prevent treaty abuse)• Released on 14 March 2014• Proposed amendments to OECD model treaty• Limitation-on-benefits (LOB) provision• "Purpose" provision• PEs in third countries• "Saving clause"• Articles 10, 13, and 4(3)• To obtain a copy, visit www.deloitte.com/ap/dbriefs/bepscentral2. BEPS: discussion drafts on Action 2 (hybrid mismatch arrangements)• Two discussion drafts (domestic law changes and treaty issues) released on 19 March 2014• Domestic law recommended changes regardingi. Hybrid financial instruments and transfersii. Hybrid entity paymentsiii. Imported mismatches and reverse hybrids• Double deduction (DD) structures and deduction / no income (D/NI) structures• Primary response, defensive rule, and scope• Proposed amendment to OECD model treaty: comprehensive hybrid income and entity provision• To obtain a copy of the two discussion drafts, visit www.deloitte.com/ap/dbriefs/bepscentral3. China• VAT pilot program: proposed extension to more industries• Considering resource tax• For information:Vicky Wang (Shanghai): [email protected]4. Hong Kong• Advance ruling published by tax authorities• Obtaining financing in Hong Kong caused profits to be sourced in Hong Kong: surprising conclusion• To obtain a copy of our Tax Analysis on this ruling, visit www.deloitte.com/ap/dbriefs/bytes• For information:5. Treaties• Recently entered into force: India / Romania and Korea / Peru28 min
- 14 March 20141. BEPS• “Country-by-country” reporting and transfer pricing documentation: OECD publishes all comments• OECD regional consultations: Asia Pacific and Latin America / Caribbean• U.S.: “correcting extreme views”, “completely off the wall”• U.S. tax reform proposals: BEPS fingerprints• IMF and UN consultations• Israel's VAT and Italy's Google Tax• Dbriefs: BEPS Central - www.deloitte.com/ap/dbriefs/bepscentral2. China• Circular 13: export VAT refunds for Chinese export companies- For information:Vicky Wang (Shanghai): [email protected]Ye Hong (Shanghai): [email protected]• China / Taiwan double tax arrangement: negotiations- For information:Vicky Wang (Shanghai): [email protected]Ye Hong (Shanghai): [email protected]3. India• Sanofi “indirect share transfer” appeal: decision expected on 1 April 2014• Changes to India’s model investment protection agreement (in response to Vodafone case?)- For information:4. Cases• Singapore – AQQ: GAAR (section 33)- For information:Daniel Ho (Singapore): [email protected]• Spain: withholding tax on embedded royalty- For information:5. In brief• Treaties enter into force- Laos / Luxembourg- Laos / Belarus- Sri Lanka / Belarus• OECD discussion draft on transfer pricing comparable data and developing countries- To obtain a copy of the document, please visit www.deloitte.com/ap/dbriefs/bytes• Indonesia: export duties on mineral concentrates- For information:Nazly Siregar (Jakarta): [email protected]• Bitcoins: guidance in UK and Japan- For information:Tom Downing (Birmingham): [email protected]Jun Takahara (Tokyo): [email protected]• Australia – Article 10: “holds directly... voting power”- For information:David Watkins (Sydney): [email protected]24 min
- 28 February 20141. BEPS• “Country-by-country” reporting and TP documentation- Public comments on discussion draft – common themes+ Information that should not be included (e.g., intra-group payments of interest, royalties, and service fees)+ “Bottom up” versus “top down” approach: flexibility needed+ Confidentiality+ Timing- For information:Bill Dodwell (London): [email protected]Alison Brock (London): [email protected]- To obtain a copy of the Deloitte comments, please visit: www.deloitte.com/ap/dbriefs/bytes• Updated BEPS calendar- To obtain a copy of the updated OECD BEPS calendar, please visit: www.deloitte.com/ap/dbriefs/bytes- To obtain a copy of Deloitte’s color-coded and reformatted version, please visit: www.deloitte.com/ap/dbriefs/bytes2. China• Shanghai Pilot Free Trade Zone: cross-border use of RMB• Cross-border RMB cash pooling• POBO / ROBO• Other changes• For information:Vicky Wang (Shanghai): [email protected]3. Budgets• Singapore- Extension of expiring tax incentives- Singapore banks: Basel III additional tier 1 capital- Significant increase in welfare payments- For information:Daniel Ho (Singapore): [email protected]- To obtain a copy of our report, please visit: www.deloitte.com/ap/dbriefs/bytes• Hong Kong- Government is studying the issue of deductibility of interest expense- For information:Anthony Lau (Hong Kong): [email protected]- To obtain a copy of our report, please visit: www.deloitte.com/ap/dbriefs/bytes4. In brief• Treaties- Treaties signed: Bangladesh / Kuwait and Singapore / Laos- Treaties entered into force: India / Malta and Indonesia / Suriname• Taiwan- Proposal to increase personal income tax rates on high earners and the business tax rate for financial institutions- For information:Cheli Liaw (Taipei): [email protected]• Vietnam- Circular 219: VAT zero-rating for exported services- For information:Tom McClelland (Ho Chi Minh): [email protected]• India- Vodafone proposes international arbitration to settle tax dispute regarding Hutchison indirect share acquisition19 min
- 21 February 20141. Cases• India: Booz- Authority for Advanced Rulings (AAR)- Non-resident affiliates of Booz India were each held to have a PE in India- Decision based on the fact that Booz India’s business is entwined with, and commercially dependent on, non-resident affiliates- Contrast between this case and Delhi High Court’s decision in e-Funds (discussed in Dbriefs Bytes last week) is striking• India: Gupta Overseas- Agra Income Tax Appellate Tribunal- Indian company failed to withhold tax from payments to non-residents- Thus, tax deduction denied for such payments- Taxpayer argued that the provision which denies the deduction breaches the non-discrimination article under the relevant treaties- Tribunal: Article 24(4) (deduction neutrality) is breached, but not Article 24(1) (nationality)2. Japan• Consumption tax- Japan is planning to change law to impose consumption tax on in-bound supplies of services and intangibles, in B2C situations – effective 1 October 2015- Compliance is the difficult issue- Similar issue is faced in South Africa and the EU• Foreign asset report- New report is required to be filed (for the first time) by 17 March 2014- Failure to file can be punished by imprisonment• 2013 protocol to Japan / U.S. treaty- U.S. ratification process is “stuck” in the Senate3. India• “Interim budget” released this week• No income tax changes• Finance Minister: Direct Taxes Code (DTC) will be placed on Finance Ministry’s website4. BEPS• G20 Finance Ministers meet in Sydney this weekend• Expect strong political statements supporting BEPS Project• Updated OECD BEPS timetable: www.deloitte.com/ap/dbriefs/bytes5. In brief• Treaties- India / Croatia- Philippines / Nigeria• Upcoming budgets- Singapore: today- Hong Kong: 26 February 2014• OECD publishes comments on two discussion drafts- To access the comments, please visit www.deloitte.com/ap/dbriefs/bytes• New Zealand: Alesco case- Taxpayer’s appeal to Supreme Court discontinued after settlement agreed with tax authorities23 min
- 14 February 20141. Cases• India: e-Funds- Delhi High Court- Definition of PE under India / U.S. treaty- PE status is not determined by earlier MAP agreement between the two competent authorities- Court applied OECD and UN Commentaries to conclude “no PE”- Different approach from recent cases in Spain (Roche and Dell) and India (Rolls Royce and Convergys)- For information:K.R. Sekar (Bangalore): [email protected]• Netherlands: Redeemable preference shares (RPS)- Netherlands Supreme Court- RPS issued by Australian subsidiary to Netherlands parent- RPS treated as debt for Australian tax purposes- Court: RPS are equity for Dutch tax purposes- For information:2. BEPS• Country-by-country reporting- UK: template included in 30 January 2014 discussion draft requires “too much information”• Unilateral action: Canada- Proposal to include “anti-treaty shopping” provision in domestic tax law- For information:3. India• Enforcement of tax return filing, in regard to royalties and technical service fees• Vodafone: conciliation talks break down• DTC: don’t hold your breath• For information:4. Taiwan• New withholding tax rules for outbound payments of certain royalties and technical service fees• Retrospective from 2011• For information:5. In brief• Singapore / Poland and New Zealand / Papua New Guinea treaties entered into force• China: Circular 2 (movement of cash out of China, on capital account) and Bulletin 9 (procedural changes regarding establishment of Chinese corporate residence based on “effective management”)- For information:Vicky Wang (Shanghai): [email protected]Ye Hong (Shanghai): [email protected]• United Nations: report of October 2013 meeting of Committee of Tax Experts- To obtain a copy of the report, please visit www.deloitte.com/ap/dbriefs/bytes• Australia: revised draft determination on capital support payments- For information:David Watkins (Sydney): [email protected]• OECD report: “Standard for Automatic Exchange of Financial Account Information”- To obtain a copy of the report, please visit www.deloitte.com/ap/dbriefs/bytes27 min
- 7 February 20141. BEPS• Action 13: TP documentation and “Country-by-Country” (CbC) reporting- Discussion draft issued on 30 January 2014 (public comments requested by 23 February 2014)- Three types of document+ Common template for CbC reporting+ TP documentation: master file+ TP documentation: local file- To obtain a copy of the discussion draft, please visit: www.deloitte.com/ap/dbriefs/bytes- For information:Shanto Ghosh (Boston): [email protected]Eunice Kuo (Shanghai): [email protected]• BEPS: Unilateral actions- Mike Danilack (U.S. competent authority): foreign tax authorities are using BEPS concepts in tax audits and MAP discussions• Action 1: Digital economy- Comments by Pascal Saint-Amans: not appropriate to formulate tax rules specifically for the digital economy- Therefore?• Action 2: Hybrid mismatch arrangements- Leaked discussion draft2. Cases• Singapore: BBO case- Insurance company derived profit on sale of shares in subsidiary- Held to be a tax-exempt capital gain- For information:• India: Brown & Sharpe- U.S. company’s “liaison office” in India performed sales promotion activities- Tribunal: U.S. company taxable under domestic tax law and had a PE under the India / U.S. treaty- For information:• India: Tesco- Hong Kong company’s “liaison office” in India performed activities related to sourcing goods for export- Tribunal: domestic tax law exemption applies- For information:3. Australia• Government releases draft legislation (third version) on the third and final element of the “investment manager” regime• Public comments requested by 14 February 2014• To obtain a copy of the Tax Alert, please visit: www.deloitte.com/ap/dbriefs/bytes• For information:4. Singapore• Bitcoins- Singapore releases guidance on the GST and income tax treatment of virtual currencies such as Bitcoins- For information:• Stamp duty- Revision of rules for waiver of stamp duty in regard to transactions between associated entities- Future operation of new rules – two key changes+ Deadlines for filing of application+ 12 months association condition extended to intermediary companies- For information:5. In brief• Treaty: India / Fiji• Hong Kong: listed REITs- For information:Patrick Yip (Hong Kong): [email protected]• Indonesia: 5% final tax on bond interest income of registered mutual funds- For information:Nazly Siregar (Jakarta): [email protected]• China: Tobin tax?28 min
- 24 January 20141. BEPS• OECD webcast- Update on the 6 actions which will be finalized by September 2014- Little new information- However, no reference to this week's newspaper story that task force has decided that specific rules for "pure play digital companies" will not work- Interesting Q&A session- To obtain a copy of the recorded webcast, www.deloitte.com/ap/dbriefs/bytes• Submission on PE avoidance schemes- Only one submission made- To obtain a copy of the submission, click here• Canada: OTIP- Canadian tax authorities launch Offshore Tax Informant Program (OTIP)- Under OTIP, Canadian tax authorities will pay rewards to informants who provide information on international tax non-compliance, both tax evasion and offshore tax avoidance2. Cases• India: Uttam Galva Steel- Mumbai Income Tax Appellate Tribunal- Offshore procurement company- Tribunal: TP position must be determined on aggregate basis, not by looking at each type of transaction separately- For information:Anis Chakravarty (Mumbai): [email protected]• U.S.: Rent-A-Center- U.S. Tax Court- U.S. group sets up captive insurance company in Bermuda- Insurance company provides insurance to its U.S. sister subsidiaries only- Court held that the insurance arrangements were bona fide and should be respected for tax purposes3. Hong Kong• Tax audits regarding offshore funds- Hong Kong tax authorities have commenced a tax audit initiative in regard to offshore fund structures• Company law change: amalgamations- Hong Kong company law will be changed, effective 3 March 2014, to permit the amalgamation of Hong Kong incorporated companies within a group, without the need for court approval• For information:4. Australia• Australian tax authorities consider proposal to outsource parts of tax audits to external auditors, which would generally be the Big 4 accounting firms• For information:5. China• SAT reports single largest transfer pricing adjustment in regard to cross-border service charges: taxes and interest of US$132 million• Two "bad facts": (a) switch of allocation methodology, (b) Chinese companies had no legal, or economic, rights to IP which results from recharged R&D• For information:Vicky Wang (Shanghai): [email protected]6. In brief• UN: invitation for submissions regarding UN TP Manual• India / Albania treaty entered into force• Japan: still focused on tax rates28 min
- 17 January 20141. BEPS• Digital economy: OECD publishes comments- 17 organizations made comments, including Deloitte- To obtain a copy of all comments, visit www.deloitte.com/ap/dbriefs/bytes- For information:Bill Dodwell (London): [email protected]Alison Lobb (London): [email protected]• Digital economy: EU expert group- Publication of papers following its first meeting in December- To obtain a copy of the papers, visit www.deloitte.com/ap/dbriefs/bytes• OECD webcast- Thursday, 23 January, 3pm to 4pm (CET)- To register for the webcast, go tohttp://www.oecd.org/tax/beps-webcasts.htm• Netherlands hesitates on country-by-country reporting- For information:2. Cases• Customs duty case: Skechers• Canadian International Trade Tribunal• Contribution payments for “unsuccessful” R&D: should the payments be included in the customs value?• Key issue: are such payments “in respect of” the imported goods?• Tribunal decides in favor of customs authorities• For information:Bob Fletcher (Singapore): [email protected]3. China• Amended company law- Objectives of simplifying the process and relaxing the requirements for forming a Chinese company- Amendments effective on 1 March 2014• Circular 96- VAT and consumption tax guidance on e-commerce exports• For information:Vicky Wang (Shanghai): [email protected]4. Bitcoins• Huge gyrations in value• Response of different countries varies• Number of businesses accepting payments in Bitcoins increases5. In brief• Vietnam: APA program- For information:Tom McClelland (Ho Chi Minh): [email protected]• Treaties- Japan / Oman: treaty signed- Singapore / Morocco: treaty entered into force• Hong Kong: captive insurance- For information:Anthony Lau (Hong Kong): [email protected]• Australia: patent box- For information:David Watkins (Sydney): [email protected]22 min
- 10 January 20141. Cases• Casio- Delhi Income Tax Appellate Tribunal- "Excessive" amount of advertising, marketing and promotion (AMP) expenditure- Charge-back principle applies, even though the Indian company is a fully-fledged distributor- For information:Anis Chakravarty (Mumbai): [email protected]• Li and Fung- Delhi High Court- Indian company rewarded by related Hong Kong company on "cost plus 5%" basis for performance of sourcing functions- Tax authorities argued that the purchase price of goods should be included in the cost base, and that the Indian company assumed significant risks- Court: decision for taxpayer- For information:Anis Chakravarty (Mumbai): [email protected]• Dash Engineering- Philippines Supreme Court- Taxpayer failed to file petition for judicial review (for refund of excess VAT input tax) within 30 day "window"- Court denies refund- For information:2. China• Bulletin 72- Non-recognition treatment for certain share reorganizations- "Foreign to foreign"+ Non-recognition treatment will not apply if transferee is in better "capital gains" treaty position than transferor+ If transferee is in better "dividend withholding tax" treaty position than transferor, non-recognition treatment can still apply, but transferee will be denied lower treaty rate for dividends paid out of pre-acquisition profits. Treaty override?- For information:Vicky Wang (Shanghai): [email protected]Ye Hong (Shanghai): [email protected]• Circular 698 case- Largest tax bill for a circular 698 (indirect share transfer) case3. India• TP safe harbors- Central Board directs that safe harbors are not evidence of arm's length prices- For information:Anis Chakravarty (Mumbai): [email protected]• Vodafone- News report that Vodafone and government are likely to commence conciliation talks in regard to all outstanding tax disputes4. Japan• 2014 tax reform proposals• Reduction in effective corporate income tax rate from approximately 38% to 35%• For Japanese brances of foreign companies and foreign branches of Japanese companies: change from "entire income" rule to profit attribution rule (effective for income year commencing on 1 April 2016)• For information:5. In brief• Treaties: entry into force- Belgium / China- Singapore / Belarus- India / Latvia- Thailand / Estonia- India / UK (protocol)• Australia- Backlog of unlegislated measures- Discussion draft on thin cap- For information:David Watkins (Sydney): [email protected]• BEPS- Italy: "Google tax"- Discussion drafts and public consultations: February to May27 min
About Deloitte Asia Pacific Dbriefs Bytes
From the publisher's feed
Deloitte Asia Pacific Dbriefs Bytes