April 3, 2022
U.S. Tax This Week for April 1
Ernst & Young's U.S. Tax This Week newsletter for the week ending April 1 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.
Top of the Week
FY2023 Budget includes new details on international tax proposals
In its FY2023 explanation of the Biden Administration's revenue proposals (Budget), the United States (US) Treasury offers several new international tax proposals that build upon the Build Back Better Act (BBBA), which was passed by the US House of Representatives in November 2021 but stalled in the US Senate. (For discussion of the BBBA's international provisions, see Tax Alert 2021-2040.) The Budget treats the BBBA as enacted, with its revenue estimates scored against the BBBA as the baseline. EY Tax Alert 2022-0514 has details.
President Biden releases FY23 Budget, increasing health spending by $26.9 billion
President Joe Biden released his fiscal year (FY) 2023 budget on March 28, requesting $127.3 billion in discretionary funding for the Department of Health and Human Services (HHS), a $26.8% increase from the 2021 enacted level. The National Institutes of Health (NIH) would get $49 billion, which includes a $5 billion investment in the Advanced Research Projects Agency for Health (ARPA-H) to conduct research on "cancer and other diseases such as diabetes and dementia." The Food and Drug Administration (FDA) would receive a $2.1 billion increase over FY 2022 appropriations to total $8.4 billion, including for monitoring of global supply chains and artificial intelligence investments. The Centers for Disease Control and Prevention (CDC) budget would increase by $2.3 billion over FY 2022 appropriations to total $10.675 billion. EY Tax Alert 2022-0496 has details.
EY Guides and Publications
EY's Worldwide VAT, GST and Sales Tax Guide 2022
While greatly accelerating the pace of all their tax legislation, the world's governments continue to rely heavily on indirect taxes as an invaluable source of revenue. As a result, there is increased risk that taxpayers will be caught unprepared, making a current, detailed guide like EY's Worldwide VAT, GST and Sales Tax Guide all the more valuable. The guide is available for download here.
EY publication highlights accounting implications of 2022 Q1 income tax developments
The Quarterly tax developments for the quarter ended March 31 is available here. Prepared by Ernst & Young LLP's Tax Accounting group, this publication provides a quarterly overview of enacted tax legislation, as well as regulatory developments and other items through March 21, 2021, except as noted.
The outlook for global tax policy and controversy in 2022
The fiscal challenges facing governments today are shared; the globalization and digitalization of the economy, climate change and the ongoing repercussions of the COVID-19 pandemic remain top of mind around the globe. How governments are responding to these and other challenges is addressed in this article, with observations by EY Tax professionals in 68 jurisdictions gathered in the annual EY Tax Policy and Controversy Outlook survey at the end of 2021. This article (with reports for all 68 jurisdiction) identifies and examines the trends and areas of divergence found in the contributors' projections for 2022, at the global, regional and individual jurisdiction levels.
Multi-hub operating models in the context of global developments and tax reforms (April 6)
Global business trends including digital or technology-driven transformation, growth in direct-to-consumer models, hybrid working models and resilient supply chain initiatives are challenging traditional highly centralized single entrepreneur tax models. During this EY Webcast, Ernst & Young professionals will discuss the impact of global business trends on multi-hub operating models.
US corporate income tax compliance - Tax year 2021 readiness and preparing your tax function for what’s next (April 6)
During this EY Webcast, Ernst & Young professionals will discuss preparing for the 2021 US federal and state tax filings as well as key considerations for international filers.
What key trends are shaping the future of cross-border controversy (April 7)
During this EY Webcast, Ernst & Young professionals will address various cross-border controversy topics and feature insights from EY professionals from around the globe.
Indirect tax considerations of digital assets, Web3 and the metaverse (April 13)
Join our EY team of tax professionals for the first in a series of discussions focused on the evolving digital landscape of blockchain technology, digital assets, Web 3.0 applications and how those items may converge in a metaverse ecosystem. During this 75-minute EY Webcast, we will discuss this evolving landscape through a state & local and indirect tax lens.
Recent Tax Alerts
— Mar 31: Colombia and Luxembourg sign double tax treaty (Tax Alert 2022-0510)
— Mar 31: Australia issues 2022 - 23 Federal Budget (Tax Alert 2022-0508)
— Mar 31: Turkey proposes new tax bill (Tax Alert 2022-0505)
— Mar 30: Nova Scotia budget 2022-23 discussed (Tax Alert 2022-0502)
— Mar 30: OECD releases IT-format to support exchange of tax information on digital platforms (Tax Alert 2022-0500)
— Mar 29: Vietnam relaxes several COVID-19-related entry requirements (Tax Alert 2022-0492)
— Mar 29: Australia restores pathway to permanent residence for certain skilled temporary migrants (Tax Alert 2022-0491)
— Mar 28: USTR announces 232 tariff agreement with the United Kingdom, reinstates some China Section 301 product exclusions (Tax Alert 2022-0488)
— Mar 25: Luxembourg Tax Authorities update XSD schema to allow submission of corrective MDR reports (Tax Alert 2022-0485)
— Mar 31: House Oversight and Reform Committee hearing on examining pathways to universal health coverage (Tax Alert 2022-0511)
— Mar 30: What to expect in Washington (March 30) (Tax Alert 2022-0498)
— Mar 29: House approves 'SECURE 2.0' retirement bill (Tax Alert 2022-0495)
— Mar 29: Senate HELP Committee holds retirement hearing (Tax Alert 2022-0494)
— Mar 30: Tobacco company may deduct, as a business expense, portion of punitive damage award paid to Oregon (Tax Alert 2022-0507)
— Mar 30: Utah legislation adopts de minimis exemption from nonresident income tax withholding; law reduces personal income tax rate retroactive to January 1, 2022 (Tax Alert 2022-0501)
— Mar 30: Indiana law lowers personal income tax rate in 2023 and 2024; new local taxes may be imposed for emergency medical services (Tax Alert 2022-0497)
— Mar 29: Ohio Senate passes SALT deduction cap workaround (Tax Alert 2022-0493)
State and Local Tax Weekly
Highlights of this edition include:
— Ohio Supreme Court clarifies 'true-object test' for bundled transactions and sales tax on automated services In its opinion in Cincinnati Federal Savings & Loan Co. the Supreme Court of Ohio (OH S.Ct.) affirmed a decision by the Ohio Board of Tax Appeals (OH BTA) that sales and use tax applies to transactions involving data processing services, but vacated the OH BTA's ruling that charges relating to customized software are taxable.
— Income/Franchise, Sales & Use, Business Incentives, Property Tax, Controversy, Payroll & Employment Tax, Miscellaneous Tax, Unclaimed Property, Value Added Tax, Unclaimed Property
IRS Weekly Wrap-Up
| ||2022-21||26 CFR 601.601: Rules and Regulations (Also Part 1, §§ 25, 143, 6a.103A-1(b)(4), 6a.103A-2(f)(5)).|
| ||2022-07||ANNOUNCEMENT AND REPORT CONCERNING ADVANCE PRICING AGREEMENTS|
Internal Revenue Bulletin
| ||2022-14||Internal Revenue Bulletin of April 4, 2022|
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.