Get an immediate FREE trial of Orbitax's International Tax Research & Compliance Expert (ITRCE) software for 7 days.

The Tax Hub

Daily Tax Newsletter

Worldwide Tax News

Approved Changes (4)

Brazil

Responsive image

Brazil Extends and Introduces Special Regimes for Oil and Gas Sector

On 18 August 2017, Brazil published Decree No. 9128/2017 and Provisional Measure 795/2017. Decree No. 9128/2017 extends to 31 December 2040 the special customs regime for the import and export of equipment used in oil and gas reserve development activities (REPETRO). Provisional Measure 795/2017 established a new special tax regime for the oil and natural gas sector. Key points of the regime include:

  • A federal tax suspension on permanently imported goods used for the exploration, development and production of oil, natural gas and other fluid hydrocarbons, including for:
  • Import tax (duty);
  • Tax on manufactured products (IPI);
  • Contribution for the social integration program (PIS) on imports; and
  • Contribution for social security funding (COFINS) on imports;
  • Five years after import, the suspension on import tax and IPI becomes an exemption, and PIS/COFINS contributions rates become 0%; and
  • A similar suspension/exemption for the import and acquisition in the domestic market of raw materials, intermediate products, and packaging materials to be used in the final production process in relation to the oil and gas activities mentioned above.

Both the Decree and the Provisional Measure entered into force the day they were published and are effective from 1 January 2018. However, the Provisional Measure must be extended or converted into law within 60 days to remain in force.

Ecuador

Responsive image

Ecuador Updates Tax Havens List with Addition of Hong Kong and Certain Regimes in Costa Rica, the Netherlands, New Zealand, and the UK

The Ecuador Internal Revenue Service (SRI) issued Resolution No. NAC-DGERCGC17-00000433 on 17 August 2017, which amends the country's list of tax havens and preferential tax regimes issued in 2015. Changes include:

  • The addition of Hong Kong; and
  • The addition of the following country-specific regimes:
    • With regard to Costa Rica, private company regimes, where a company is created under Costa Rican law but not registered with the Costa Rican tax administration;
    • With regard to the Netherlands, tax regimes for investment companies providing an exemption or zero rate of income tax, tax regimes subject to prior tax decisions/rulings, and innovation (patent) box regimes;
    • With regard to New Zealand, the tax regime applicable to trusts; and
    • With regard to the United Kingdom, tax regimes enabling companies to maintain capital rights with nominal holders without economic risk of ownership and beneficial ownership is unknown, and innovation (patent) box regimes.

There are a number of tax consequences in relation to Ecuador's tax haven list, including increased withholding taxes, an increased income tax rate in Ecuador when owned by a resident of a tax haven, and others (previous coverage).

Italy

Responsive image

Italy Clarifies Credit for Foreign Taxes Withheld for a CFC

Italy has published Resolution No. 112/E of 11 August 2017, which clarifies the foreign tax credit available in Italy for foreign taxes paid by a controlled foreign company (CFC). The resolution concerns an Italian parent of a Hong Kong CFC that was subject to withholding tax on income derived from Malaysia, the Philippines, and Taiwan for the provision of advisory services. According to the resolution, where the CFC rules apply, a credit is available for the parent company in Italy not only for the tax paid by the CFC in its jurisdiction of residence, but also for tax paid through withholding on income derived from other jurisdictions, provided that the tax was actually charged to the CFC. The resolution also notes that this position is in line with the results of BEPS Action 3 and the Anti-Tax Avoidance Directive (EU) 2016/1164.

Venezuela

Responsive image

Venezuela Sets 3.0% Special Contribution Rate for Insurance Sector

Venezuela has published Resolution No. 498 of 1 August 2017 from the Ministry of Banking and Finance, which sets a 3.0% rate for the special contribution payable by insurance and reinsurance companies, companies engaged in prepaid medicine for health plans, risk managers, and companies that finance insurance fees or premiums. The special contribution is to finance the Superintendence of Insurance Activity, and is to be paid semi-annually based on the taxpayer's net income from premiums, interest, and related fees. The rate may be set periodically within a range of 1.0% to 3.0%.

Treaty Changes (5)

Australia-Uruguay

Responsive image

Australia and Uruguay to Reopen SSA Negotiations

Officials from Australia and Uruguay have recently met to discuss the reopening of negotiations for a social security agreement. Any resulting agreement would be the first of its kind between the two countries, and must be finalized, signed and ratified before entering into force.

Brunei-Philippines

Responsive image

Brunei and the Philippines Conclude Tax Treaty Negotiations

According to recent reports, officials from Brunei and the Philippines have concluded negotiations for an income tax treaty. The treaty will be the first of its kind between the two countries, and must be signed and ratified before entering into force.

Hong Kong-Saudi Arabia

Responsive image

Tax Treaty between Hong Kong and Saudi Arabia Signed

On 24 August 2017, officials from Hong Kong and Saudi Arabia signed an income tax treaty. The treaty is the first of its kind between the two jurisdictions.

Taxes Covered

The treaty covers Hong Kong profits tax, salaries tax, and property tax. It covers Saudi Zakat and income tax, including the natural gas investment tax.

Service PE

The treaty includes the provision that a permanent establishment will be deemed constituted when an enterprise furnishes services within a Contracting Party through employees or other engaged personnel for the same or connected project for a period or periods aggregating more than 183 days within any 12-month period.

Withholding Tax Rates

  • Dividends - 5%
  • Interest - 0%
  • Royalties - 5% for royalties paid for the use of, or the right to use, industrial, commercial, or scientific equipment; otherwise 8%

Capital Gains

The following capital gains derived by a resident of one Contracting Party may be taxed by the other Party:

  • Gains from the alienation of immovable property situated in the other Party;
  • Gains from the alienation of movable property forming part of the business property of a permanent establishment in the other Party; and
  • Gains from the alienation of shares of a company deriving more than 50% of its asset value directly or indirectly from immovable property situated in the other Party; and
  • Gains from the alienation of shares of a company resident in the other Party if the alienator owns 10% or more of the shares of the company.

Gains from the alienation of other property by a resident of a Contracting Party may only be taxed by that Party.

Double Taxation Relief

Both countries apply the credit method for the elimination of double taxation.

Non-Discrimination

The treaty does not include a non-discrimination article, although the final protocol provides that if Saudi Arabia enters into a tax treaty that does include an article on non-discrimination (with certain exceptions), then negotiations will be entered into to introduce provisions on non-discrimination into the Hong Kong-Saudi Arabia treaty.

Entry into Force and Effect

The treaty will enter into force on the first day of the second month following the exchange of the ratification instruments, and will apply in Hong Kong from 1 April of the year following its entry into force and in Saudi Arabia from 1 January of the year following its entry into force.  

Morocco-Bulgaria

Responsive image

Morocco Approves Pending SSA with Bulgaria

On 24 August 2017, the Moroccan Council of Ministers approved the pending social security agreement with Bulgaria. The agreement, signed 21 September 2016, is the first of its kind between the two countries, and will enter into force after the ratification instruments are exchanged.

Peru-France-Germany-Spain-United Kingdom

Responsive image

Peru Planning to Conclude Negotiations for Tax Treaties with France, Germany, Spain, and the UK

Peru's Ministry of Foreign Affairs is planning to conclude negotiations for income tax treaties with France, Germany, Spain, and the UK. Treaties with France, Germany, and the UK would be the first of their kind between Peru and the respective countries, while a treaty with Spain would replace the tax treaty between the two countries that was signed in 2006, but never ratified.

Sitemap

Powerful Tax Tools

NEW

FX Rates

Global FX Rates including Tax Year Average FX Rates and Spot Rates for all Reporting Currencies.

NEW

Corporate Tax Rates

Corporate tax rates, surtaxes, and effective tax rates for the current year, as well as historical rates and approved future rates.

NEW

Country Analysis

Detailed tax guidance for companies doing business in over 100 countries, including summaries and snapshots of key tax facts and issues.

NEW

Cross Border Tax Calculator

Calculate total tax costs and benefits of a cross border transaction including withholding tax, participation exemption and foreign tax credit rules.

NEW

Cross Border Tax Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment streams.

NEW

OECD BEPS Project

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

NEW

Tax Calendar

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

NEW

Tax Forms

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

NEW

Worldwide Tax Treaties

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

NEW

Worldwide Tax Planner

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

NEW

Certified Rates Report

Customizable Certified Rates Report providing updated corporate and withholding tax rates at the end of each month for over 100 countries.

NEW

Withholding Tax Minimizer

Enables quick calculation of tax costs and benefits of cross border transactions considering all possible transaction combinations and optimal routes.

NEW

VAT Rates

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

NEW

NOL Calculator

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

NEW

Transfer Pricing Calculator

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

NEW

Individual Income Tax Rates

Individual tax rates for over 100 countries.

Play of the Day

Translate Documents

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

Get Started with Orbitax Today

With Orbitax, you get reliable and comprehensive solutions for international tax research, compliance and planning. Contact us today to get started with Orbitax.

We’re here to help

We’re here to answer any questions you have about the Orbitax products and services.

Send us a message

Who’s behind Orbitax?

We’re committed to providing high value, low cost tax research and management solutions.

Learn More