This issue of BDO’s Corporate Tax News contains an overview of a variety of international tax changes.
The European Commission has published a draft directive to combat the misuse of shell entities for improper tax purposes in the European Union. Known as “ATAD III (Anti-Tax Avoidance Directive III), the directive would introduce a “minimum substance test" and reporting requirements, which could result in the denial of tax benefits to EU entities that are considered to have no or minimal economic substance.
The United Arab Emirates—which historically has been known for its 0% corporate tax—is set to impose a 9% federal corporate tax from June 2023, a development that will affect domestic and multinational business operations and structures in the country. The introduction of a corporate tax regime indicates that the UAE (as a member of the OECD Inclusive Framework) intends to address the challenges arising from the digitalisation of the global economy and ensure the implementation of a global minimum tax. The OECD has released for public comment draft model rules on “Amount A,” the share of a business’s residual profits that will be subject to the new taxing right created under Pillar One.
A variety of tax changes are being made in annual budgets and tax reforms in Belgium, India, Italy, Japan, Malaysia, the Netherlands and South Africa. There are corporate tax rate changes in Myanmar, Netherlands and Turkey, new withholding tax rules in Cyprus and a reduced rate on dividends in Turkey.
If you would like more information on any of the articles in this issue—or would like to discuss their implications for your business—please contact your local BDO professional or the author listed at the end of the article.
- THE EUROPEAN UNION: Proposal for preventing misuse of shell entities unveiled
- INERNATIONAL:
- AUSTRALIA: ATO finalises its compliance approach to the imported hybrid mismatch rule
- BELGIUM: Special tax regime for expatriates amended
- CYPRUS: Withholding tax introduced on payments to companies in low-tax jurisdictions
- INDIA: Budget 2022 includes rules on tax treatment of crypto-currency
- ITALY: Budget law 2022 includes changes to new super deduction
- JAPAN: 2022 tax reform proposals would expand scope of earnings stripping rules to foreign entities
- LUXEMBOURG: Investment funds required to confirm absence of Luxembourg real estate holdings
- MALAYSIA: Tax exemption for foreign-source income temporarily extended
- MYANMAR: Update on corporate tax rate, financial year change and e-filing
- THE NETHERLANDS: Tax accounting impact of enacted income tax measures
- SOUTH AFRICA: Tax accounting impact of enacted income tax measures
- SWITZERLAND: Code of Conduct Taxation 2021 Released
- TURKEY: Corporate income tax rate cut for manufacturers/exporters, dividend withholding tax rate reduced
- UNITED ARAB EMIRATES: Corporate tax to be introduced in the UAE
- UNITED STATES:
Content adapted from BDO Global.
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