- Details
On November 18, 2016 the Swiss Federal Department of Finance (FDF) issued press releases announcing that on that same date the Swiss Confederation signed joint declarations with the Federative Republic of Brazil, the United Mexican States and the Oriental Republic of Uruguay on the introduction of Automatic Exchange Of Information (AEOI) in tax matters on a reciprocal basis.
- Details
On November 18, 2016 the Hungarian Ministry for National Economy issued a press release announcing that at a press conference organized on the sidelines of the Regional Digital Conference in Budapest, the Hungarian Minister for National Economy announced that Hungary’s current corporate income tax rates of 10% and 19% are set to be reduced to a flat rate of 9% as of next year.
- Details
On November 16, 2016 the Swiss Federal Department of Finance issued a press release announcing that on that same date the Swiss Confederation and the Argentine Republic signed a joint declaration on the introduction of Automatic Exchange Of Information (AEOI) in tax matters on a reciprocal basis.
- Details
On November 17, 2016 on the website of the Court of Justice of the European Union (CJEU) the opinion of Advocate General Kokott in Case C‑68/15, X (ECLI:EU:C:2016:886) was published.
In this reference for a preliminary ruling, the Court of Justice has been asked to determine whether a tax levied in the Kingdom of Belgium, which undertakings are required to pay under certain circumstances when they distribute profits, is compatible with the freedom of establishment and with Directive 2011/96/EU (‘the Parent-Subsidiary Directive’).
Belgian tax law enables undertakings to carry forward losses without limitation to future assessment periods and to claim a deduction for so-called risk capital. However, according to the Belgian government, these measures resulted in a situation where certain undertakings paid virtually no tax but still distributed profits. Since this is unfair to other taxpayers, a tax called the ‘fairness tax’ was to be separately levied in order to limit the excesses caused by the opportunities for deduction.
The tax essentially applies where companies distribute profits but have effectively lowered their liability for tax on profits in the same taxable period through use of the aforementioned deductions. In simple terms, the taxable amount is based on the amount by which a company’s distributed profits exceed its taxable profits. Prior to applying the tax rate, that amount is multiplied by a so-called proportionality factor, which reflects the extent by which profits were reduced through the use of loss and risk-capital deductions.
Doubt is cast on whether the fairness tax is compatible with the freedom of establishment, since it also covers non-resident companies that operate in Belgium through a permanent establishment rather than through a subsidiary. Moreover, since the tax has characteristics of both a corporation tax and a dividend withholding tax, it is in dispute whether the tax is precluded by the Parent-Subsidiary Directive.
- Details
On November 16, 2016 the Competent Authorities of Singapore and Canada concluded an Agreement on the Automatic Exchange of Financial Account Information to Improve International Tax Compliance (Hereafter: The Agreement).
Singapore and the Canada will commence the Automatic Exchange of Information under the CRS by September 2018. The first year for which information will be exchanged under the Agreement is 2017.
Page 3 of 5
