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June 20, 2021
2021-1215

U.S. Tax This Week for June 18

Ernst & Young's U.S. Tax This Week newsletter for the week ending June 18 is now available. Prepared by Ernst & Young's National Tax Department in Washington, D.C., this weekly update summarizes important news, cases, and other developments in U.S. taxation.

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Top of the Week

G7 leaders affirm commitment to global tax changes under BEPS 2.0

On 11-13 June, the leaders of the G7 countries met in Cornwall under the United Kingdom (UK) Presidency of the G7. The communiqué issued at the conclusion of the summit includes an endorsement of the strong support expressed earlier by the G7 Finance Ministers for the global tax changes being developed in the G20/OECD Inclusive Framework project on addressing the tax challenges of the digitalization of the economy (the BEPS2.0 project). With the encouragement of this G7 support, attention now turns to the upcoming July meeting of the G20 Finance Ministers and the ongoing effort to achieve agreement among the 139 jurisdictions of the Inclusive Framework in connection with that meeting. EY Tax Alert 2021-1179 has details.

Ways & Means holds hearing with Treasury Secretary Yellen

The House Ways & Means Committee June 17 held a broad-ranging hearing focusing on the President's FY 2022 budget with Treasury Secretary Janet Yellen that included discussion of the Biden administration's proposed international tax changes and related OECD BEPS 2.0 negotiations, and proposals to narrow the tax gap. The Committee continued to relitigate the TCJA and its benefits, and Republicans expressed concern about increasing deficits, debt, and inflation. EY Tax Alert 2021-1214 has details.

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Upcoming Webcasts

Accounting for income taxes: A quarterly perspective (June 22)
During this Thought Center Webcast, Ernst & Young professionals will discuss ongoing issues and regulatory trends in the tax accounting arena. Topics will include recent tax legislation with tax accounting implications and a review of current income tax accounting concepts.

The indirect tax technology journey: Now. Next. Beyond. (June 23)
During this Thought Center Webcast, Ernst & Young professionals will share insights into how market-leading organizations are using technology to adapt to new legislation and market trends, and to effectively transform tax operations.

2021 outlook for international tax reform (June 29)
During this Thought Center Webcast, Ernst & Young professionals will discuss what President Biden's budget, corporate revenue proposals and other global developments could mean for international taxation.

President Biden’s executive order on supply chains (June 30)
In response to President Biden’s recent executive order, various US government agencies have submitted recommendations on how to strengthen the US supply chain to assure continuous production of critical goods. During this Thought Center Webcast, Ernst & Young professionals will focus on the agencies’ findings and their effects on multinational corporations’ supply chains.

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Recent Tax Alerts

Courts

— Jun 17: Supreme Court leaves ACA in place, dismisses latest constitutional challenge on procedural grounds (Tax Alert 2021-1212)

— Jun 17: Taxpayer may revoke inadvertent election to capitalize underwriting fees for certain tax years (Tax Alert 2021-1211)

— Jun 16: IRS will require private foundations to electronically file Form 4720 due July 15, 2021 or later (Tax Alert 2021-1200)

— Jun 16: IRS signals it is cross-checking employer information when assessing employer shared responsibility payments (Tax Alert 2021-1193)

International

— Jun 17: New trade agreement between UK and Australia includes multiple immigration provisions (Tax Alert 2021-1213)

— Jun 17: Chilean tax authorities are evaluating foreign service providers' compliance with recently enacted VAT on digital services (Tax Alert 2021-1210)

— Jun 17: Chilean tax authorities issue resolution amending the regulations for claiming reduced withholding rates (Tax Alert 2021-1207)

— Jun 17: The treaty for the avoidance of double taxation between Brazil and Switzerland has been ratified by the Brazilian President's sanction (Tax Alert 2021-1204)

— Jun 16: Argentina enacts law raising corporate income tax rates (Tax Alert 2021-1203)

— Jun 16: US-EU announce Joint Cooperative Framework for Large Civil Aircraft; Suspend punitive tariffs on wide range of products for five-year period (Tax Alert 2021-1199)

— Jun 17: UK and Australia agree on trade deal (Tax Alert 2021-1197)

— Jun 16: Armenian tax authorities begin transfer pricing audits (Tax Alert 2021-1195)

— Jun 16: Luxembourg Tax Authorities issue guidance on the “equity escape clause” under interest limitation rules (Tax Alert 2021-1194)

— Jun 16: Argentine Central Bank issues new guidance for certain entities to access to the official foreign exchange market (Tax Alert 2021-1192)

— Jun 15: Ecuador's president announced foreign trade and investment policy measures (Tax Alert 2021-1189)

— Jun 16: Poland announces plans to propose broad incentives for investors (Tax Alert 2021-1187)

— Jun 15: Kenya proposes changes to Tax Appeals Tribunal Act, 2013 (Tax Alert 2021-1186)

— Jun 15: Turkey sets effective date for Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information (Tax Alert 2021-1185)

— Jun 15: The Latest on BEPS and Beyond for June 2021 (Tax Alert 2021-1184)

— Jun 14: Turkey approves Tax Amnesty Law (Tax Alert 2021-1177)

— Jun 11: US taxpayers should be mindful of certain tax provisions that may need to be considered with respect to bitcoin following approval of recent legislation in El Salvador (Tax Alert 2021-1172)

— Jun 11: El Salvador approves bitcoin as legal tender (Tax Alert 2021-1171)

— Jun 14: Israel and United Arab Emirates sign tax treaty (Tax Alert 2021-1170)

— Jun 11: Jersey and Guernsey to extend economic substance rules to partnerships (Tax Alert 2021-1168)

— Jun 11: Canadian government begins to ease travel restrictions in July 2021 (Tax Alert 2021-1166)

— Jun 11: USCIS issues policy manual updates to improve immigration services (Tax Alert 2021-1165)

— Jun 11: EU's framework for interoperable digital certificates of vaccination, testing and recovery to take effect on July 1 (Tax Alert 2021-1164)

Legislation

— Jun 17: House passes corporate disclosure package requiring country-by-country tax reporting for multinationals, 215-214 (Tax Alert 2021-1206)

— Jun 16: Treasury Secretary Yellen testifies at Senate Finance Committee hearing on President's FY22 budget (Tax Alert 2021-1201)

— Jun 16: Senate Finance Committee hearing on mental health (Tax Alert 2021-1196)

— Jun 16: What to expect in Washington (June 16) (Tax Alert 2021-1191)

States

— Jun 16: Tennessee resumes charging employers accounts with COVID-19 UI benefits; state to withdraw from participation in federal pandemic UI relief programs (Tax Alert 2021-1202)

— Jun 16: Colorado legislature approves changes to combined reporting rules and other income tax rules (Tax Alert 2021-1198)

— Jun 14: Florida Legislature repeals law limiting nonprofit hospital's property tax exemption to community benefit provided (Tax Alert 2021-1181)

— Jun 14: Washington law expands coverage under its paid family and medical insurance program (Tax Alert 2021-1180)

— Jun 11: California FTB holds sixth interested parties meeting to discuss next round of proposed amendments to its market-based sourcing rules (Tax Alert 2021-1167)

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Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

— Illinois legislature approves significant tax changes affecting bonus depreciation, dividends, GILTI and net loss deductions On June 1, 2021, the Illinois Legislature approved the state's FY 2022 budget legislation, SB 2017, which includes provisions that would modify Illinois's income, franchise and sales/use tax laws and would extend the sunset date for certain credit and incentive provisions. 

—  Income/Franchise, Sales & Use, Business Incentives, Property Tax, Controversy, Payroll & Employment Tax, Miscellaneous Tax, Unclaimed Property, Value Added Tax, Unclaimed Property

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IRS Weekly Wrap-Up

Corrections

 TD 9942Small Business Taxpayer Exceptions Under Sections 263A, 448, 460 and 471; Correction

Revenue Procedures

 2021-28Changes in use.(Also Part I, §§ 163(j), 168, 446; 1.446-1, 1.163(j)-9.)
 2021-2926 CFR 601.601. Rules and regulations

Revenue Rulings

 2021-12Determination of Issue Price in the Case of Certain Debt Instruments Issued for Property

Notices

 2021-37Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates

Internal Revenue Bulletin

 2021-24Internal Revenue Bulletin of June 14, 2021

Because the matters covered herein are complicated, U.S. 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.

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

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