January 31, 2021
U.S. International Tax This Week for January 29
Ernst & Young's U.S. International Tax This Week newsletter for the week ending January 29 is now available. Prepared by Ernst & Young's International Tax Services group, this weekly update summarizes important news, cases, and other developments in international taxation.
Treasury Secretary Janet Yellen was sworn into office on 26 January, the day after the Senate approved her nomination to be the first woman to hold the post. The following day, Secretary Yellen spoke with her UK and German counterparts, saying she was “committed to active U.S. participation in the ongoing OECD discussions on international taxation to forge a timely international accord,” according to a readout of the call. A Treasury statement released after one of the calls reiterated the message that Secretary Yellen plans to “re-engage actively in the ongoing OECD discussions on international taxation.“
Pascal Saint-Amans, Director of the Organisation for Economic Co-operation and Development (OECD) Centre for Tax Policy and Administration noted Yellen’s Senate Finance Committee confirmation hearing testimony last week, saying the US appears to have a “strong appetite” for the OECD Base Erosion and Profit Shifting (BEPS) 2.0 Pillar Two proposals regarding a minimum tax. During a keynote speech at the New York State Bar Association’s virtual tax conference this week, Saint-Amans said, “What we can anticipate is a much more constructive approach” from the new Biden administration with respect to the BEPS 2.0 negotiations. In regard to last year’s US proposal to implement Pillar One as a safe harbor, Saint-Amans said, “I don’t see it has any chance to prosper anytime soon.” The OECD on 21 January released updated guidance addressing the impact of the COVID-19 pandemic on tax treaty-related issues. The latest guidance revisits guidance published in April 2020 and represents the OECD Secretariat’s views on the interpretation of the provisions of tax treaties (i.e., each jurisdiction may adopt its own guidance to provide tax certainty to taxpayers). However, the guidance reflects the general approach of jurisdictions and illustrates how some jurisdictions have addressed the impact of COVID-19 on the tax situations of individuals and employers. The guidance addresses permanent establishments, the residence status of companies (based on place of effective management) and individuals, and the treatment of employment income. EY Tax Alert 2021-0189 has details.
Decoding India Union Budget 2021-22: Impact and the way forward (February 5)
On February 1, India’s Finance Minister will present the Union Budget 2021. Please join us for this webcast as Tax leadership from Ernst & Young LLP (India) and Ernst & Young LLP (US) help decode the fine print of the India Budget 2020–21.
Tax in the time of COVID-19 (February 5)
During this Thought Center Webcast, Ernst & Young professionals will discuss coronavirus (COVID-19) and the resulting economic crisis – all occurring in an election year – have made reacting to tax and trade developments more complicated and more difficult. Panelists will provide updates on: (i) Elections, US economy and tax policy; (ii) What’s happening at the IRS; and (iii) Breaking developments.
International tax talk quarterly series with the EY Global Tax Desk Network (February 9)
During this Thought Center Webcast, Ernst & Young professionals will discuss the most pertinent recent global tax developments affecting your business. Panelists will include representatives from our EY Global Desks and Global Tax Policy and will cover perspectives from the OECD, European Union, Latin America and Asia Pacific.
EY Guides and Publications
How Tax will play a vital role in the coming recovery
In this article, EY's Global Vice Chair - Tax, Kate Barton discusses how tax authorities have played a key part in the response to the global COVID-19 pandemic. According to the article, Tax has taken on an unexpected and expanded role in the world's response to the COVID-19 crisis.
Recent Tax Alerts
— Jan 27: US COVID-19 travel restrictions discussed (Tax Alert 2021-0192)
— Jan 27: US extends travel restrictions to foreign nationals traveling from the UK, Ireland, Schengen Area, and Brazil; adds travel restrictions to foreign nationals traveling from South Africa (Tax Alert 2021-0193)
— Jan 25: Hong Kong provides clarifications for the concessionary tax regime for qualifying ship leasing activities (Tax Alert 2021-0172)
Canada & Latin America
— Jan 27: Chile and the Netherlands sign double tax treaty (Tax Alert 2021-0191)
— Jan 27: Slovenian Tax Office clarifies social security and personal income tax implications on income received from foreign entity by Slovenian employees (Tax Alert 2021-0195)
— Jan 27: OECD Secretariat issues updated guidance on tax treaties and the impact of COVID-19 pandemic (Tax Alert 2021-0189)
— Jan 26: Spanish Supreme Court issues favorable decision on reclaims by non-Spanish pension funds (Tax Alert 2021-0186)
— Jan 26: Gibraltar announces its approach to Gibraltar Mandatory Disclosure Rules post UK-EU Brexit Agreement (Tax Alert 2021-0185)
— Jan 15: France introduces new tax and social security measures for 2021 (Tax Alert 2021-0107)
— Jan 28: Israeli Tax Authority releases final circular on payments to a parent company under cross-border recharge agreements for grant of stock-based compensation (Tax Alert 2021-0205)
— Jan 28: Saudi Arabia extends tax amnesty until 30 June 2021 (Tax Alert 2021-0204)
IRS Weekly Wrap-Up
Internal Revenue Bulletin
| ||2021-04||Internal Revenue Bulletin of January 25, 2021|
Ernst & Young Client Portal, the leading source for news, analysis, and reference materials for corporate tax professionals, has a variety of content of interest to international tax practitioners, including:
— International Tax Online Reference Service. Key information about, and important tax developments from, 56 foreign jurisdictions, including information on tax rates, interest rates and penalties, withholding, and filing dates.
— EY/Passport. EY/Passport is your guide to planning ventures in the global economy, offering a wealth of tax and business knowledge on more than 150 countries.
Because the matters covered herein are complicated, U.S. International Tax This Week should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor.