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Approved Changes (3)


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Australian Legislation for Diverted Profits Tax and Increased Penalties for SGEs Receives Royal Assent

On 4 April 2017, the Treasury Laws Amendment (Combating Multinational Tax Avoidance) Bill 2017 and the Diverted Profits Tax Bill 2017 received royal assent as Act No. 27 and Act No. 21 of 2017 respectively. The first bill contains measures for the new Diverted Profits Tax (DPT), the increased penalties for Significant Global Entities, and the latest OECD transfer pricing guidelines, while the second bill sets the DPT rate (previous coverage). The measures generally apply from 1 July 2017, except for the transfer pricing guidelines, which apply from 1 July 2016.


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India Draft GST Rules Published

India’s Central Board of Excise and Customs has published draft and revised rules in relation to the upcoming GST regime, which is to be implemented 1 July 2017. The draft rules include:

  • Composition Rules;
  • Valuation Rules;
  • Transition Rules;
  • Input Tax Credit (ITC) Rules;
  • Revised Invoice Rules;
  • Revised Payment Rules;
  • Revised Refund Rules;
  • Revised Registration Rules; and
  • Revised Return Rules.

Click the following link for the draft GST rules page for details of each. Comments, if any, may be sent to latest by 10 April 2017.


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Jersey Provides Penalty-Free Tax Disclosure Opportunity until End of 2017

The Jersey government has announced that the Treasury is running a tax disclosure opportunity from 3 April until the end of 2017, which provides that no penalties, interest, or fines will be due, aside from the late payment surcharge if applicable. The disclosure opportunity is available for individuals and businesses registered in Jersey, as well as any businesses not registered in Jersey if managed and controlled in the island. The disclosure applies in relation to annual tax returns, GST returns, monthly employer ITIS returns, and other statements or documents that have been provided in support of a tax return.

Proposed Changes (3)


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Irish Government Remains Committed to Phasing out USC

In a recent speech to the Oireachtas (Irish legislature), Minister of State for Financial Services, Eoghan Murphy, reiterated the government's commitment to phasing out the Universal Social Charge (USC). The phasing out of the USC is part of broader medium-term income tax reform plan meant to reduce the cost of labor, broaden the tax base, and reduce excessive tax rates for middle income earners while limited the benefit for higher earners. The most recent step in a gradual process for reducing the USC was an overall reduction in the rates from 2017 (previous coverage) and additional steps for reduction will be taken in future budgets.


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Kenya 2017/2018 Budget includes Several Incentives

On 30 March 2017, Cabinet Secretary for the National Treasury, Henry Rotich, delivered Kenya's 2017/2018 Budget to the National Assembly (lower house of parliament). The main tax-related proposals in the budget focus on incentives, including:

  • A 150% investment deduction for capital expenditure in marine, fisheries and fish processing (blue economy);
  • A reduced corporate rate for new motor vehicle assemblers of 15% for the first five years (standard 30%); and
  • New Special Economic Zone (SEZ) incentives:
    • 100% investment deduction for capital expenditure on buildings and machinery;
    • Withholding tax exemption on dividend payments to non-residents (standard 10%); and
    • 5% withholding tax on interest payments to non-residents (standard 15%).

The budget also includes expanding the individual income tax bands by 10% as follows:

  • up to KES 147,580 - 10%
  • over KES 147,580 up to 286,623 - 15%
  • over KES 286,623 up to 425,666 - 20%
  • over KES 425,666 up to 564,709 - 25%
  • KES 564,710 and over - 30%

Click the following link for the Budget Statement for 2017/2018. The tax-related measures are included in the Finance Bill 2017, which must now be finalized and approved in parliament.

United Nations

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UN Publishes Proposed BEPS Changes to Model Tax Treaty

The UN has published an agenda paper on the proposed BEPS-related changes to the UN Model tax treaty as part of the fourteenth session of the Committee of Experts on International Cooperation in Tax Matters held 3 to 6 April 2017. The main points include possible changes relating to permanent establishments (Article 5), including:

  • Adding anti-contract splitting rules;
  • Eliminating the "same or connected project" provision regarding service PEs;
  • Amending the PE exceptions, so that the all categories of exceptions require that the activity is of a preparatory or auxiliary character;
  • Adding a new anti-fragmentation rule; and
  • Broadening the scope of the dependent agent PE rules to counter structures aimed at the avoidance of a PE (including commissionaire arrangements).

Other changes include:

  • Adding a new section on tax policy considerations in the Model commentary;
  • Adding a new title and preamble to clarify that tax treaties are not intended to be used to produce situations of double non-taxation;
  • Expanding on the residence tie-breaker to test to provide that the competent authorities should endeavor to determine residence by mutual agreement;
  • Amending the recommended conditions for a reduced dividend withhold rate to include a direct holding of at least 25% throughout a 365-day period including the date of payment;
  • Replacing the paragraph concerning the taxation of gains from the alienation of shares deriving value from immovable property with the OECD model paragraph, and adding comparable interests, such as interests in a partnership or trust, in relation to the taxation of gains from the alienation of shares in a company; and
  • Amending the Model exemption and credit method provisions for the elimination of double taxation to clarify that the provisions do not require relief to be provided in respect of tax imposed exclusively because of the residence of an entity.

Click the following link for the full paper: Proposed Base Erosion and Profit-Shifting Related Changes to the United Nations Model Double Taxation Convention between Developed and Developing Countries.

Treaty Changes (3)

Hong Kong-Portugal-South Africa

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Hong Kong Signs Agreements for Automatic Exchange of Financial Account Information with Portugal and South Africa

The Hong Kong government has announced the signing of agreements with Portugal and South Africa for the automatic exchange of financial account information in tax matters. Under the agreements, each country will automatically exchange information on accounts held in the respective country by tax residents of the other country based on the OECD Common Reporting Standard (CRS).


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New Tax Treaty between Mauritius and Zambia under Negotiation

Officials from Mauritius and Zambia have reportedly begun negotiations for a new income tax treaty. Any resulting treaty would need to be finalized, signed, and ratified before entering into force, and once in force and effective, would replace the 2011 tax treaty between the two countries.


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Protocol to the Tax Treaty between Moldova and Luxembourg to be Signed

On 30 March 2017, officials from Luxembourg and Moldova agreed to the signing of an amending protocol to the 2007 income and capital tax treaty between the two countries. The protocol will be the first to amend the treaty, and must be finalized, signed, and ratified before entering into force. Additional details will be published once available.


Powerful Tax Tools


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Complete overview of the OECD BEPS Project, including daily BEPS news, country adoption of BEPS measures, and an overview of the 15 BEPS Actions.


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Customizable calendar tool that tracks corporate income tax, value added tax and transfer pricing obligations by country or entity.


Tax Forms

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.


Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.


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Calculates the worldwide tax cost of what-if scenarios based on legal entity structure, taxable income, and cross border transactions.


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Provides value added tax (VAT) rates, goods and services tax (GST) rates and other indirect tax rates for over 100 countries.


NOL Calculator

Country specific calculator to determine how net operating losses can be utilized in carryback and carryforward years.


Transfer Pricing Calculator

Calculates TP ratios under various TP methods and calculates the difference between target ratios and actual ratios.


Individual Income Tax Rates

Individual tax rates for over 100 countries.

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