European Commission Repeals UK/Gibraltar Decision

Posted on October 25th, by Global Tax Weekly in Government. No Comments

In December 2018, the European Commission declared a number of tax exemptions in Gibraltar unlawful and incompatible with state aid rules. The decision concerned Gibraltar’s corporate tax exemption regime for passive interest and royalties applicable between January 1, 2011, and June 30, 2013, and between January 1, 2011, and December 31, 2013, respectively. It also covered five tax rulings granted between 2011 and 2013.

According to the Commission, the exemption regime gave an unfair advantage to some multinational companies. Gibraltar repealed the contentious tax exemptions in 2013 and 2014 but the UK and Gibraltar authorities were required to recover the aid, worth about EUR100m.

In a statement welcoming the EC’s decision, the Gibraltar Government said: “The Government is delighted to note that the European Commission has today announced that it has decided to repeal its decision to open infraction proceedings against the UK … Read More »

OECD Makes Progress On Minimum Tax Plans

Posted on October 19th, by Global Tax Weekly in Corporation Tax, OECD. No Comments

The OECD has reached an agreement on its far-reaching corporate tax reform plans, following productive discussions with some of the hold-out countries which remained against the proposals; at the time of writing, Kenya, Nigeria, Pakistan and Sri Lanka remain opposed, whilst Ireland, Estonia and Hungary have agreed to sign up to the plans, subject to certain conditions.

As a result, sufficient international agreement has now been reached to go ahead with a new global minimum corporate tax rate of 15 percent, which will be introduced for large multinational enterprises (MNEs) from 2023, and represents Pillar Two of the Agreement.

Supported by 136 countries and jurisdictions representing more than 90 percent of global GDP, the agreement will also bring in new tax rules to reallocate to market jurisdictions taxing rights on profits earned by the world’s 100 largest and most profitable MNEs, representing … Read More »

Guernsey Considering GST

Posted on October 12th, by Global Tax Weekly in Sales Tax. No Comments

In Guernsey, where the introduction of a goods and services tax is under consideration, the Policy and Resources Committee warned – ahead of a debate on the proposed tax – that rejecting proposals for the introduction of goods and services tax would result in new levies being required on workers.

The Committee has put forward three options to close the current budget deficit: the introduction of a GST with either a five or eight percent rate, or a three percent “health tax”, levied through the social security system. In a statement released ahead of a parliamentary debate, Deputy Peter Ferbrache, President of the Policy and Resources Committee, observed that:

“We know that many States Members are reluctant to adopt a GST as part of the solution to the funding shortfalls we’ll face if we are to maintain reasonable public services that meet … Read More »

Australia’s Offshore Banking Unit Regime To Be Repealed

Posted on October 7th, by Global Tax Weekly in Offshore. No Comments

Legislation to repeal Australia’s offshore banking unit regime has been enacted, with provisions to close the regime to new entrants were included in the Treasury Laws Amendment (2021 Measures No. 2) Bill 2021.

The changes followed the regime’s designation as a harmful tax regime by the OECD and the European Union. The OBU regime was established in 1992 to provide a more attractive tax rate for offshore banking activity conducted by Australian registered banks. In October 2018 the OECD’s Forum on Harmful Tax Practices (FHTP) raised concerns during a review of this regime, including the concessional tax rate and the ring-fenced nature of the regime.

For more information on this, and other topical international tax matters, please visit: https://www.cchgroup.com/roles/corporations/international-solutions/research/global-tax-weekly-a-closer-look


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