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Approved Changes (2)

European Union

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European Commission Notice on Notion of State Aid Published in Official Journal

The European Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union was published in the Official Journal of the European Union on 19 July 2016. While primarily directed at national tax authorities, it also provides useful information for companies concerned with State aid issues in the EU.


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Portugal's Madeira Region Individual Income Tax Rates for 2016

The individual income tax rates for Portugal's autonomous Madeira region have been published. The tax rates, which differ slightly from Portugal's standard rates, are as follows:

  • up to EUR 7,035 - 13.41%
  • over EUR 7,035 up to 20,100 - 28.5%
  • over EUR 20,100 up to 40,200 - 37.0%
  • over EUR 40,200 up to 80,000 - 45.0%
  • over EUR 80,000 - 48.0%

The rates apply from 1 January 2016.

Proposed Changes (3)

European Union

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EU Commission Launches Consultation on Reduced VAT Rates for Electronically Supplied Publications

On 25 July 2016, the European Commission launched a public consultation on reduced value added tax (VAT) rates for electronically supplied publications, which are currently only available for printed publications under EU VAT rules. The objective of the consultation is to seek stakeholder views on:

  1. The commitment by the Commission in its 2016 Actions Plan on VAT to:
    • allow Member States the application of reduced rates for electronically supplied publications;
    • allow Member States the application of super-reduced and zero rates for electronically supplied publications;
  2. The definition and scope of electronically supplied publications; and
  3. The potential impacts of reduced rates for electronically supplied publications.

Click the following link for the consultation page. The consultation runs through 19 September 2016.


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Ireland Tax Strategy Group Papers and Income Tax Reform Plan

Ireland's Department of Finance has published a series of Tax Strategy Group (TSG) papers, which are produced annually and list out options and issues to be considered while drafting the Budget. The papers do not include specific proposals, but do reference proposals made in the Summer Economic Statement for 2016 (previous coverage). The published papers include:

In addition to the TSG papers, the Department of Finance also published an Income Tax Reform Plan, which sets out options for planned increases in personal income tax credits and relief, and the continued phasing out of the Universal Social Charge.


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Slovenia Proposed Corporate and Individual Income Tax Amendments

Slovenia's Ministry of Finance has published proposed corporate and individual income tax amendments. The proposed corporate income tax amendments are meant to reduce the fiscal deficit and equalize treatment of taxpayers, and include:

  • Increasing the corporate tax rate from 17% to 19%;
  • Abolishing tax relief for donations to political parties;
  • Repealing the special rates and capital gains exemption on equity holdings disposals for venture capital companies; and
  • Disallowing the recognition of goodwill amortization as an expense for tax purposes.

The proposed individual income tax amendments are meant to reduce the tax burden on labor, and include:

  • Adding a new individual income tax bracket between the current second and third brackets and reducing the rate of the current third bracket as follows:
    • up to EUR 8,021.34 -16%
    • over EUR 8,021.34 up to 20,400.00 - 27%
    • over EUR 20,400.00 up to 48,000.00 - 34%
    • over EUR 48,000.00 up to 70,907.20 - 39%
    • over EUR 70,907.20 - 50%
  • Providing a tax exemption on bonus payments equal to 70% of the average monthly wage in Slovenia; and
  • Improving and clarifying the beneficial treatment of income from basic agricultural and forestry activities.

Subject to approval, the proposed amendments would generally apply from 1 January 2017.

Treaty Changes (5)


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TIEA between Chile and Jersey Signed

A tax information exchange agreement between Chile and Jersey has been signed by Chile on 24 June 2016 and by Jersey on 21 July. The agreement is the first of its kind between the two jurisdictions. It will enter into force once the ratification instruments are exchanged, and will generally apply for tax periods beginning on or after the date of its entry into force.


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Cyprus and Mongolia to Negotiate Tax Treaty

According to recent reports, officials from Cyprus and Mongolia met on 15 July 2016 and agreed to begin negotiations for an income tax treaty. Any resulting treaty would be the first of its kind between the two countries, and must be finalized, signed and ratified before entering into force.


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Germany Ratifies New Tax Treaty with Japan

On 18 July 2016, Germany ratified the pending income tax treaty with Japan (previous coverage). The treaty, signed 17 December 2015 will enter into force 30 days after the ratification instruments are exchanged, and will apply from 1 January of the year following its entry into force. However, Article 25 (Exchange of Information) will apply from the date of its entry into force. Once in force and effective, the treaty will replace the 1966 income tax treaty between the two countries, which is currently in force.


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Panama and Vietnam Conclude Tax Treaty Negotiations

Panama's Ministry of Foreign Affairs has announced that officials from Panama and Vietnam concluded negotiations with the initialing of an income tax treaty on 22 July 2016. The treaty will be the first of its kind between the two countries, although a previous draft had been initialed in June 2014, but was never signed. The new draft must now be signed and ratified before entering into force.

Peru-Argentina-Bolivia-Brazil-Chile-Colombia-Costa Rica-Dominican Rep-Ecuador-El Salvador-Paraguay-Portugal-Spain-Uruguay-Venezuela

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Peru Ratifies Ibero-American Social Security Convention

On 15 July 2016, the decree ratifying the Ibero-American Social Security Convention was published in Peru's Official Gazette. The convention will enter into force for Peru after the ratification instrument is deposited. The multilateral convention has been signed by 15 countries and is currently in force for Bolivia, Brazil, Chile, Ecuador, El Salvador, Paraguay, Portugal, Spain, and Uruguay, and will enter into force for Argentina on 1 August 2016.


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Individual Income Tax Rates

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

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