October 30, 2022
U.S. International Tax This Week for October 28
Ernst & Young's U.S. International Tax This Week newsletter for the week ending October 28 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.
A Treasury official this week said it is working on establishing "prophylactic" measures to address new tax regimes in the context of future tax treaties. He indicated that Treasury wants to include rules in US treaties that would consider tax regimes that do not yet exist in order to prevent issues arising later.
The official was also quoted as saying that the US and Croatia are expected to sign a first-ever income tax treaty before the end of the year. He confirmed earlier reports that US reservations to the proposed US-Chile tax treaty are pending approval in the Chilean Parliament. The Senate Foreign Relations Committee last spring approved the Chilean treaty subject to two reservations. The official further said there are current plans to update the existing US-Switzerland and US-Israel tax accords.
On a separate topic, a Treasury official this week was quoted as saying it hopes to release proposed crypto regulations before the end of the year. The Infrastructure Investment and Jobs Act, enacted in November 2021, imposed information-reporting requirements on sales of cryptocurrency and other "digital assets." Cryptocurrency and other digital assets sold by customers of "brokers" will be subject to Form 1099-B reporting and cost-basis reporting.
The legislation specifically amended the Code to make certain changes, including expanding the definition of a broker, defining digital assets, and applying the cost-basis-reporting regime for securities to digital assets. It also required brokers to report to the Internal Revenue Service the basis of digital assets transferred to their customers or other non-brokers and requires digital assets to be treated as "cash" when received in the course of a trade or business. The amendments will be effective for information returns filed in 2024 for the 2023 calendar year.
The official was quoted as saying the proposed rules would provide clarity as to effective dates regarding reporting, which she noted is necessary for market participants.
An Organisation for Economic Co-operation and Development (OECD) official this week also said that the organization wants as many jurisdictions as possible to adopt the OECD's Crypto Asset Reporting Framework (CARF) to ensure harmonization for reporting and other related areas. The OECD on 10 October published the final CARF, which would bring cryptocurrency and other crypto-assets into scope for reporting. The OECD earlier indicated that it is working to a "ensure a broad implementation of the CARF as the single global reporting framework for Relevant Crypto-Assets." The official said this week that the OECD would begin work on the implementation package in the coming months and that it would include an automatic exchange of information framework, a section on compliance measures to ensure CARF is applied appropriately, along with an implementation timeline.
Tax in the time of COVID-19: Update on legislative, economic, regulatory and IRS developments (November 18)
During this EY Webcast, Ernst & Young professionals will discuss how businesses can navigate the tax policy environment and continue to effectively operate their tax function in this time of crisis and change. Panelists will provide updates on: (i) The US economy and tax policy; (ii) Breaking developments; and (iii) What’s happening at the IRS.
Recent Tax Alerts
— Oct 25: USCIS again extends COVID-19-related flexibilities (Tax Alert 2022-1620)
— Oct 27: Kenya High Court holds that a decision for abandonment of taxes is upon initiation and determination by the Commissioner (Tax Alert 2022-1626)
— Oct 24: Ghana enacts various amendments to tax laws introduced in 2022 Mid-year Budget Review Statement (Tax Alert 2022-1610)
— Oct 25: Hong Kong announces new immigration policies to attract overseas and mainland Chinese talent (Tax Alert 2022-1619)
— Oct 24: Malaysia imposes excise duty on premix preparations (Tax Alert 2022-1616)
Canada & Latin America
— Oct 24: Chile’s Executive Power modifies tax reform bill (Tax Alert 2022-1612)
— Oct 24: Argentina issues new regulations on "tax for an inclusive and supportive Argentina" (Tax Alert 2022-1611)
— Oct 27: Portugal publishes regulations relating to multiple immigration categories (Tax Alert 2022-1627)
— Oct 26: Sweden announces new requirements for immigration applications (Tax Alert 2022-1622)
— Oct 26: Bulgarian Government proposes VAT bad debt relief (Tax Alert 2022-1621)
— Oct 25: OECD/G20 Inclusive Framework holds 14th plenary meeting and publishes 6th annual progress report (Tax Alert 2022-1618)
— Oct 25: Netherlands launches consultation on BEPS 2.0 – Pillar Two implementation (Tax Alert 2022-1617)
— Oct 21: OECD releases public consultation document on administration and tax certainty aspects of Amount A of Pillar One (Tax Alert 2022-1608)
— Oct 21: Cyprus adopts Law on Shipping Limited Liability Company (Tax Alert 2022-1606)
— Oct 21: G20 Finance Ministers welcome progress made on BEPS 2.0 and call for swift implementation (Tax Alert 2022-1603)
— Oct 21: Israel publishes new TP regulations following adoption of BEPS Action 13 principles in domestic legislation (Tax Alert 2022-1607)
— Oct 27: Australia issues 2022-23 October Federal Budget (Tax Alert 2022-1624)
IRS Weekly Wrap-Up
Internal Revenue Bulletin
| ||2022-44||Internal Revenue Bulletin of October 31, 2022|
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:
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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.