Archive for Tax Policy

Are You Providing Digital Services To Japan?

If you’re a provider of digital services to customers in Japan, please be aware that the changes being introduced on 1st October 2015 may affect you.

Old Rules

Under the Consumption Tax Act (Act No. 108 of 1988), a service rendered in Japan is subject to Consumption Tax which is equivalent to VAT (i.e. Value Added Tax).

The criteria for determining whether a service is rendered inside or outside Japan varies depending on the nature of the service.

Under the current rules (i.e. pre October 2015), the tax treatment relating to the provision of e-commerce services, such as e-books, online games, internet delivery of music, etc. is Read More

Written by | Posted in International • Tax Policy

India Changes Tax Law; Makes MAT Provisions Inapplicable To Foreign Investors

Welcome news for foreign investors in India!

 

Following is the Press release by Ministry of Finance:

“Through the amendment the Government proposes to clarify that MAT provisions will not be applicable to FIIs/FPIs not having a place of business/ permanent establishment in India, for the period prior to 01.04.2015. Pending such amendment, CBDT will convey to the field formations the decision of the Government to accept the recommendation.

The Report of the Committee is available on the website of the Finance Ministry and the Read More

Written by | Posted in Tax Policy

Innovation Box Tax Reform Proposal

On July 29. 2015, the House Ways and Means Committee announced that some members had drafted a bill calling for an innovation box (aka patent box), similar to what is used in a few others countries, such as the UK. Chairman Ryan praised the bill as relevant to international tax reform and helping US companies be more competitive.

The proposal has two parts:

1. 71% deduction of the lesser of (a) “innovation box profit for the year” or (b) taxable income (without the deduction).

2. Provision to allow US companies to bring back to the US foreign intellectual property tax free. Read More

Written by | Posted in Tax Policy

The Senate Finance Committee Approves Bipartisan Tax Extenders Bill

On July 21st of 2015, the Senate Finance Committee overwhelmingly passed a tax extenders bill with a bipartisan vote of 23 to 3 that plans to extend over 50 previously expired tax provisions for a two year period (e.g., retroactively to cover all of calendar year 2015 and prospectively to cover all of calendar year 2016).

The bipartisan tax extenders package includes provisions to assist both individuals and business entities alike. Just a few of the more popular tax provisions outlined within this bill include, but are not limited to:

• The Research & Experimentation Tax Credit Program;

• The I.R.C. § 179D Energy Tax Deduction for Building Envelope Efficiency; Read More

Written by | Posted in R&D Credit Services • Tax Policy • Tax Provision/Tax Reporting

South African Tax Man’s Message To HSBC Account Holders

The South African Revenue Service (SARS) has announced an amnesty of sort – a threat and upfront warnings: we do know about you, best you come forward before we make the tax audit into your affairs known.

On July 9th, 2015, SARS issued a press release, which can be read in more detail on:

http://www.sars.gov.za/Media/MediaReleases/Pages/9-July-2015 – – – South-Africans-with-accounts-and-investments-in-foreign-tax-jurisdictions.aspx

The International Consortium of Investigative Journalists (ICIJ), based information obtained by French newspaper Le Monde, ranked South Africa number 31 among the countries with the largest amount of dollars ($2.3blion) in the so-called leaked Swiss Read More

Written by | Posted in Africa • Expatriate • FATCA • FBAR • Income Tax • International • IRS • OECD • OVDP • Swiss Bank Accounts • Tax Controversy • Tax Fraud/Evasion/Crimes • Tax Policy • Tax Provision/Tax Reporting • Tax Risk Management • Transfer Pricing • United States

Spotlight On Expatriate Tax Experts – September 21st 2015 – Internet Tax Summit

With an estimated 8.7 Million expatriates living around the world, many are unaware of their U.S. tax filing obligations. For those following the issues surrounding FATCA, they are well aware that expatriates are angry and scared. For the two-thirds of the U.S. expatriates who are still unaware, we bring knowledgeable experts who will explain what is happening and get you up to date at the Internet Tax Summit scheduled September 21-25th 2015. The first day of the Internet Tax Summit, expatriates will be able to go online and learn what is happening from tax experts, get answers, and get the help they need.  You can expect this historical, free online event is certain to get millions of expatriates up to speed on the only country in the world with citizen based taxation. We promise the information you learn will be STUNNING! Read More

Written by | Posted in Estate Planning Tax • Europe, Middle East • Expatriate • FATCA • FBAR • Internet Tax Summit - 2015 • OECD • OVDP • Tax Policy • TaxConnections

The House of Representatives Passes the Protect Medical Innovation Act of 2015

On Thursday, June 18th The House of Representatives passed H.R. 160 entitled “The Protect Medical Innovation Act of 2015” (hereinafter “PMIA”) by a vote of 280 to 140 in an attempt to repeal the medical device excise tax that was introduced in H.R. 3590 entitled “The Patient Protection and Affordable Care Act of 2010” (hereinafter “PPACA”).

PMIA was introduced by Republican Erik Paulsen, R-Minn., a member of the tax-writing House Ways and Means Committee. PMIA aims to repeal the 2.3 percent excise tax on medical devices, such as pacemakers and operating-room monitors. The legislation now heads to the Senate floor for deliberations where repealing the medical device tax also has bipartisan support. Republican Erik Paulsen indicated in a statement “as a country, we take great pride in our ability to create, invent, and innovate—especially when it comes Read More

Written by | Posted in Federal • Tax Policy

The House of Representatives Passes The Permanent Internet Tax Freedom Act

On Tuesday, June 9th The House of Representatives passed H.R. 235 entitled the “Permanent Internet Tax Freedom Act” (hereinafter “PITFA”) by voice vote permanently banning states from taxing internet access or placing multiple or discriminatory taxes on e-commerce. It should be duly noted that the PITFA legislation would simply remove the current end date of October 1st of 2015 from the Internet Tax Freedom Act which was originally signed into law in 1998.

PITFA’s bipartisan legislative intent is clearly aimed at keeping the current moratorium on taxes on internet access in place and extending it indefinitely. As a historical synopsis, Congress passed a temporary moratorium on multi-state taxes collected for internet access back in 1998. The ban has been extended numerous times in the 17 years since, Read More

Written by | Posted in Tax Policy

How The IRS Is Connected To The Growing Sharing Economy

The Sharing Economy

On the internet, everything is for hire. Last night 40,000 people rented accommodation from a service that offers 250,000 rooms in 30,000 cities in 192 countries. They chose their rooms and paid for everything online. But their beds were provided by private individuals, rather than a hotel chain. Hosts and guests were matched up by Airbnb, a firm based in San Francisco. Since its launch in 2008 more than 4,000,000 people have used it—2,500,000 of them in 2012 alone. It is the most prominent example of a huge new “sharing economy”, in which people rent beds, cars, boats and other assets directly from each other, coordinated via the internet. Read More

Written by | Posted in IRS • Tax Policy

IRA Contribution By April 15 May Prevent Paying Back Premium Tax Credit

The Premium Tax Credit (PTC) for individuals who purchased health insurance on the Exchange (Marketplace) is an important tax break. As income goes up, this subsidy in the form of a refundable credit decreases. Then, it hits a cliff and completely disappears if one’s household income exceeds 400% of the Federal poverty line (FPL). This can result in a tax bill of thousands of dollars!

Here is an example. A married couple, both age 64, thought their 2014 income would be about $62,000. Being eligible for insurance on the Exchange, they purchased a policy and obtained a PTC of $14,112. When they file their return, they realize they actually have $63,000 of income for 2014. this is above 400% of the FPL so they must repay all of the $14,112 PTC! If they can drop their income to $62,040 (400% of the FPL for 2014), they Read More

Written by | Posted in Affordable Healthcare Act • Individual • IRS • Retirement • Tax Policy

A Legislative Update from Capitol Hill: Continuing Coverage of 2015 Comprehensive Tax Reform

On Wednesday, March 18th the Republican leaders of Congress’s two main tax committees, the House Ways and Means Committee Chairman Paul Ryan, R-Wis., (hereinafter “Ryan”) and the Senate Finance Committee Chairman Orin Hatch, R-Utah, (hereinafter “Hatch”) wrote a letter to the Treasury Secretary Jacob Lew (hereinafter “Lew”) urging him to avoid pursuing an executive action by President Barack Obama (hereinafter “Obama”) on major tax reform in 2015.

The letter comes in direct response to a statement by the White House Press Secretary Josh Earnest (hereinafter “Earnest”) earlier this month suggesting that Obama might be open to using his executive authority to overhaul the tax code and close select tax loopholes for large corporations. The White House spokesman was probed by a reporter Read More

Written by | Posted in Tax Policy • Treasury Regulations

Corporate Tax Reform: An Illusion Or A Reality?

It has been a rallying cry that is as old as time and that rivals that of the standing ovation that the Rangers receive after scoring a power play goal: “Corporate tax in this country needs to be reformed.” Who is leading the charge? America’s chief executives. What is responsible for catapulting this into the public eye? None other than the nation’s aging tax code, which has been blamed for putting U.S. multinational corporations at a competitive disadvantage in the global marketplace.

As tax reform chatter grows louder, chief executives have become more outspoken. Timothy D. Cook, Apple’s chief executive, told lawmakers, “Apple has recommended to the Obama administration and several members of Congress — and suggests to the subcommittee today — to pass legislation that Read More

Written by | Posted in Corporate • IRS • Tax Policy
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