- Europe & Africa Newsletter This e-newsletter gives you an overview of international tax developments being reported globally by KPMG member firms in the Europe and Africa regions between 1 and 30. Algeria Belgium Bulgaria Croatia Czech Republic EU France Germany Italy Luxembourg Netherlands Nigeria OECD Poland Romania South Africa Spain Switzerland Uganda UK To contact the Group in Russia and the CIS go to the Contacts section. To register for the webcasts, click here. Tax area concerned Relevant date/case reference Description of measures and publication link (Considerations in italic where necessary) Algeria Various tax KPMG in Algeria summarizes recent areas developments of note to domestic and foreign investors in Algeria. These developments include tax rate changes, increased penalties, duties and sanctions, and new exemptions, reductions and advantages.
Belgium Excise duties 1 / 1 January 2016 The Belgian federal government as part of the tax shift announced increases to the rates of excise tax (duty) imposed on: alcohol and alcoholic beverages (effective 1 ) gas oil used as fuel (effective 1 ) non-alcoholic beverages and coffee (effective 1 January 2016) cigarettes and fine-cut tobacco (effective 1 January 2016). Tax compliance /2016 Payments made to Luxembourg, Cyprus, and the Seychelles during the current tax period are no longer required to be reported, according to the findings of an October meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes. The conclusion of the meeting is that these three jurisdictions are no longer considered to be non-compliant with OECD standards. 2016 Belgian tax authorities announced a policy change with respect to penalties for non-compliance with payroll formalities. The penalties are to be automatically assessed beginning in 2016, whereas under prior treatment, the penalties were imposed only in exceptional instances. VAT 1 January 2016 Parliament has passed legislation concerning the VAT. Specifically, the legislative measures concern the chargeability of VAT, implement a judgment of the Court of Justice of the European Union on VAT groupings, and increase the VAT exemption amount for small businesses. April 2016 The Belgian tax authorities have decided to postpone to April 2016 a requirement that legal
persons acting as directors are subject to VAT on their directors fees. Bulgaria Proposed VAT 2016 Draft amendments to the Bulgarian VAT law legislation concern the mixed use (business and private use) of company vehicles and immovable property. In light of the draft changes, businesses could encounter certain challenges and may want to consider certain steps to prepare for these changes. Croatia Corporate income tax / Transfer pricing 31 October Croatia s National Bank announced a reduction in the bank discount rate, from 7 percent per annum to 3 percent per annum, effective 31 October. This rate reduction has tax implications for related parties, both regarding the deductibility of interest expenses for corporate income tax purposes, on one hand, and the minimum acceptable interest rate on loans, on the other hand. Czech Republic Administrative and case-law Anti-avoidance / Corporate income tax The Supreme Administrative Court in issued a decision in a case concerning application of the abuse of law concept to intracompany reorganizations. In particular, the case concerned a claim for the deductibility of interest on a loan provided by a related party for financing the purchase of the ownership interest in companies acquired from the related party.
EU Customs 3 The European Commission provided d information concerning a mutual recognition decision between the European Union and China with respect to authorized economic operators in the EU and holders of the Chinese advanced certified enterprise certificate in China. France Takeovers 31 October A decree implementing the Florange Act has been published. The implementing decree specifies the scope of activities and considerations by an acquiring entity in instances when a plant closure is being considered. Proposed legislation BEPS / CbCR A new article requiring country-by-country reporting by the largest multinational enterprises was added to the Finance Bill for 2016. This country-by-country reporting requirement generally reflects the OECD base erosion and profit shifting (BEPS) recommendations, and was added by amendment to the Finance Bill for 2016. Corporate income tax October The federal tax court decided a case concerning the write-down of loan receivables due from foreign related companies. The case concerns a tax year prior to 2008 when German tax law was amended to provide that profit reductions relating to domestic and cross-border shareholder loans between corporations are no longer tax deductible and that an off-balance sheet adjustment is required. Germany
FATCA 3 Germany s Federal Ministry of Finance released final guidance notes for implementation of the FATCA regime. Treaties Double tax treaties 13 Representatives of the governments of Australia and Germany signed a revised income tax treaty. The treaty, once it is ratified by both countries and enters into force, would replace the treaty that was signed in 1972. Italy Patent box 20 A decree providing rules for implementing Italy s regime October patent box regime has been published in the official gazette. The implementing decree clarifies certain technical aspects of the patent box measures and also outlines certain transitional measures. Administrative Tax evasion The Italian Supreme Court overturned decisions of and case-law lower courts to conclude that two renowned Italian fashion designers were not guilty of tax evasion. The designers, however, could still be subject to civil penalties of about EUR 343.3 million. Luxembourg Treaties Double tax treaties 2017 A pending Protocol, that would amend the income tax treaty between Luxembourg and France, may not be effective until 2017. Netherlands Administrative and case-law Employment income According to a opinion of the Advocate General in a test case pending before
the Dutch Supreme Court, the crisis levy violates certain provisions of EU law. Nigeria BEPS Nigeria s tax authority the Federal Inland Revenue Service has incorporated into its tax audit procedures certain of the recommendations included in the OECD s BEPS project. Administrative Corporate and case-law income tax / Petroleum income tax The Nigeria Tax Tribunal, Lagos, issued a taxpayer-favorable decision concluding that the taxpayer s petroleum investment allowance with respect to assets used in its gas-to-liquid project could be 35 percent, as claimed by the taxpayer, and not limited to 5 percent as asserted by the tax authority. The case is: Chevron Nigeria Ltd. v. Federal Inland Revenue Service. OECD VAT / GST 6 The Organization for Economic Cooperation and Development (OECD) announced developments concerning the collection of consumption taxes on cross-border transactions in the jurisdiction where products are consumed. Thus, representatives of more than 100 countries and jurisdictions endorsed the new OECD International VAT/GST Guidelines as the preferred international standard for coherent and efficient application of VAT and GST. Proposed legislation BEPS 6 The OECD provided an of discussions taking place concerning the BEPS project. Administrative and case-law Exchange of information The OECD has provided an d list of frequently asked questions concerning the common reporting standard.
Mutual agreement procedure 7 The OECD released annual statistics on the mutual agreement procedure caseloads of all its member countries and of non-oecd economies that agree to provide such statistics for the 2014 reporting period. Tax evasion Leaders of the world s 20 largest economies endorsed a plan to overhaul global standards, in an effort to counter tax evasion. Poland Tax 1 July compliance 2016 Taxpayers in Poland must transmit data pursuant to a request from the tax authorities in a unified format the standard audit file beginning 1 July 2016. To satisfy this new requirement, taxpayers may need to modify their accounting systems and revise their bookkeeping rules. Proposed VAT legislation A draft of new VAT legislation would provide for a number of amendments to the existing VAT law. Romania Tax amnesty October Romania s government issued an emergency ordinance that allows for the cancellation of penalties and interest imposed for the late payment of taxes. South Africa
Proposed legislation Carbon tax 13 A draft carbon tax bill aims to incentivize both producers and consumers towards low carbon green investments and technology in order to reduce greenhouse gas (GHG) emissions by taxing GHG emissions directly. In response to the draft bill, the Davis tax committee released its first interim report on carbon tax. Spain Administrative and case-law Tax compliance European Commission infringement proceedings against Spain concern a challenge to information reporting measures that require individual taxpayers in Spain to complete and file a form and report their assets and rights located abroad. The issue is whether this reporting requirement is contrary to European Union law. Switzerland Administrative Exchange of and case-law information A recent Dutch group request for administrative assistance shows that even before the automatic exchange of information measure is effective in Switzerland in 2017, those with undeclared assets need to consider making a disclosure. Treaties Double tax treaties The exchange of diplomatic notes relating to an income tax treaty between Argentina and Switzerland occurred 28 October, meaning that the treaty will enter into force within 30 days that is, the entry into force will be in. Uganda
Treaties OECD multilateral 4 The OECD announced that Uganda signed the OECD multilateral convention on mutual convention administrative assistance in tax matters. UK Proposed Various tax The UK Chancellor of the Exchequer presented legislation areas the annual Autumn Statement and the Spending Review to Parliament. As in recent past years, the Autumn Statement included tax-related announcements. Among the items presented are proposals for a 60 percent penalty on arrangements successfully challenged under the anti-abuse rule and reductions to the rate of corporation tax, proposed to phase down eventually to 18 percent effective from 2020. Following the presentation of the Autumn Statement earlier this week, KPMG in the UK has prepared a report proving commentary and analysis of the tax changes for businesses, employers, and individuals. The KPMG commentary addresses measures concerning, among other: compliance and large business related-party rules, partnerships and transfers of intangible fixed assets SDLT seeding relief for tax-transparent property investment funds loans to participators and trustees of charitable trusts taxation of asset managers performance awards tax evasion and compliance company distributions anti-avoidance.
For a full summary of global tax developments, visit kpmg.com/taxnewsflash. Contacts in Russia and the CIS Anna Voronkova Partner, Head of +7 (495) 937 44 24 Evgenia Wolfus Partner, +7 (495) 937 44 19 Alexander Tokarev Senior Manager, +7 (495) 937 44 77 Olga Ermolaeva Senior Manager, +7 (495) 937 44 77 Elena Dolgova Senior Manager, +7 (495) 937 44 77 Yuriy Kulikov Manager, +7 (495) 937 44 77 Rezida Valitova Manager, +7 (495) 937 44 77 Privacy Legal KPMG maintains a database of subscribers, event attendees and business-related contacts. The information we maintain on you contains your business contact details, as well as the track record of our interactions with you. In managing this database, we take our obligations about confidentiality and maintenance very seriously. We do not share personal information with unaffiliated third parties. Should you require your information to be d, amended or deleted from our records please contact us at RU-FMMSKPublications@kpmg.ru outlining your requirements. KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The KPMG name, logo and "cutting through complexity" are registered trademarks of KPMG International. Designed by Evalueserve. Publication Number: 133018C-G