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January 15, 2023
2023-0092

U.S. International Tax This Week for January 13

Ernst & Young's U.S. International Tax This Week newsletter for the week ending January 13 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.

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Spotlight

Representative Kevin McCarthy became the new Speaker of the House on 7 January, reaching the necessary majority vote on the 15th ballot. Days later, the House GOP Steering Committee elected Representative Jason Smith to be the new chairman of the Ways and Means Committee. In a statement, Representative Smith listed out his priorities, which included examining whether to "continue showering tax benefits on corporations that have shed their American identity" and using trade and tax policy to "re-shore and strengthen our supply chains, where products and services vital to our national security are made here at home using American labor," among others.

The press reported this week that President Biden requested that Treasury Secretary Janet Yellen stay on in her post and that she accepted. The Treasury Secretary is expected to continue implementing provisions of the Inflation Reduction Act and to move forward with the BEPS 2.0 agenda.

Interim guidance (Notice 2023-7) on the new 15% Corporate Alternative Minimum Tax (CAMT) enacted by the Inflation Reduction Act answers many questions, but other issues remain unanswered. Taxpayers may rely on the interim guidance pending the release of proposed regulations, which are anticipated to apply for tax years beginning after 31 December 2022.

The Internal Revenue Service (IRS) has indicated it will be releasing further interim guidance before the proposed regulations are issued. The Notice provides a lengthy list of items on which the IRS invites written comments, including which guidance "is needed most quickly." Interested parties should submit written comments to the IRS electronically within 60 days after Notice 2023-7 is published in the Internal Revenue Bulletin. For an overview of the CAMT and outline of certain outstanding considerations, see EY Tax Alert 2023-0091.

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Upcoming Webcasts

Tax in a time of transition: Legislative, economic, regulatory and IRS developments (January 20)

Previously this Webcast was Tax in the time of COVID; same series, new name.

During this EY Webcast, Ernst & Young professionals will provide updates on: (i) the US economy and tax policy; (ii) what’s happening at the IRS; and (iii) breaking developments.

How life sciences tax departments are preparing for sustainability (January 24)
During this EY Webcast, Ernst & Young professionals will explore sustainability tax trends and global developments in the life sciences sector. EY teams of life sciences and sustainability tax thought leaders will discuss, and share their perspectives on emerging trends and hot topics relevant to this market.

International tax talk quarterly series: With the EY Global Tax Desk Network (January 24)
During this EY Webcast, Ernst & Young professionals will highlight developments that could affect multinational companies operating in Hong Kong and mainland China.

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Recent Tax Alerts

Africa

— Jan 09: Algeria introduces Finance Law 2023; key measures applicable to companies (Tax Alert 2023-0057)

— Jan 06: Morocco announces temporary prohibition on the entry of travelers from China Mainland (Tax Alert 2023-0045)

Asia

— Jan 12: Japan announces new COVID-19-related restrictions for travelers arriving from China Mainland and Macau (Tax Alert 2023-0084)

— Jan 12: Malaysia announces new requirements for employers when hiring or terminating foreign nationals (Tax Alert 2023-0079)

— Jan 11: Korea enacts new global minimum tax rules to align with OECD BEPS 2.0 Pillar Two (Tax Alert 2023-0069)

— Jan 11: Korea enacts 2023 tax reform bill (Tax Alert 2023-0068)

— Jan 06: Malaysia announces new COVID-19-related entry requirements for inbound travelers (Tax Alert 2023-0043)

Canada & Latin America

— Jan 12: Costa Rica introduces new digital DIMEX Cards for foreign residents (Tax Alert 2023-0082)

— Jan 11: Peru enacts preferential depreciation rates for buildings, construction and hybrid and electric vehicles (Tax Alert 2023-0073)

— Jan 11: Peru extends VAT exemption for specific goods and services and introduces a temporary early VAT recovery regime (Tax Alert 2023-0072)

— Jan 11: Canada Revenue Agency announces changes to its administrative policies for certain employee taxable benefits (Tax Alert 2023-0064)

— Jan 10: Costa Rica announces new COVID-19-related restrictions for travelers arriving from China Mainland, Hong Kong, Macau and Taiwan (Tax Alert 2023-0062)

— Jan 10: Brazil's new transfer pricing rules and their impact on customs valuation discussed (Tax Alert 2023-0060)

— Jan 06: Peruvian Government amends Income Tax Law Regulations for implementing FMV rules for valuation of securities (Tax Alert 2023-0047)

— Jan 06: Costa Rica's Tax Authority publishes income tax brackets for tax year 2023 (Tax Alert 2023-0041)

Europe

— Jan 12: Expert committee proposes changes to Norwegian tax system (Tax Alert 2023-0088)

— Jan 12: UK's High Court rules EU Settlement Scheme unlawful (Tax Alert 2023-0083)

— Jan 12: France announces new COVID-19-related entry requirements for travelers arriving from China Mainland (Tax Alert 2023-0081)

— Jan 12: Italy announces new COVID-19 restrictions for travelers arriving from China Mainland (Tax Alert 2023-0078)

— Jan 10: Italy issues 2023 Budget Law (Tax Alert 2023-0061)

— Jan 09: Danish Supreme Court issues rulings on beneficial ownership (Tax Alert 2023-0056)

— Jan 06: Spain announces new COVID-19 testing requirements for travelers arriving from China Mainland (Tax Alert 2023-0044)

— Jan 06: Ireland announces new requirements for certain applicants under the Atypical Working Scheme (Tax Alert 2023-0042)

Middle East

— Jan 12: Israel provides revised salary requirements, immigration application processing fees and COVID-19 testing requirements for travelers from China Mainland (Tax Alert 2023-0090)

— Jan 12: Qatar announces new COVID-19-related entry requirements for travelers arriving from China Mainland and Hong Kong (Tax Alert 2023-0080)

— Jan 12: Dubai reduces threshold for imposing customs duties on imports of consignments (Tax Alert 2023-0077)

Multinational

— Jan 12: PE Watch | Latest developments and trends, January 2023 (Tax Alert 2023-0085)

— Jan 09: Australia-India Economic Cooperation and Trade Agreement enters into force (Tax Alert 2023-0058)

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Recent Newsletters

ITS/Washington Dispatch
   Highlights of this edition include:

Treaty news

  • United States, Croatia sign income tax treaty

Treasury and IRS news

  • IRS issues interim guidance on application of new corporate alternative minimum tax
  • IRS releases guidance on new stock buyback excise tax
  • IRS issues final revised qualified intermediary agreements effective beginning in 2023
  • IRS releases additional guidance for brokers on transfers of interests in publicly traded partnerships
  • IRS issues proposed rules on single-entity treatment of consolidated groups
  • FinCEN continues to extend certain signature authority reporting (FBAR, Form 114)

OECD developments

  • OECD releases public consultation document on Pillar One Amount A and Digital Services Taxes
  • OECD releases consultation document on tax certainty for the Pillar Two GloBE rules
  • OECD releases consultation document on Pillar Two GloBE Information Return
  • OECD/G20 Inclusive Framework releases document on safe harbors and penalty relief under Pillar Two GloBE rules
  • OECD releases public consultation document on Amount B of Pillar One on baseline marketing and distribution functions
  • OECD's 2021 MAP statistics show US continues to decrease case inventory
  • OECD releases corporate tax statistics and the 2022 revenue statistics and consumption tax trends

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IRS Weekly Wrap-Up

Internal Revenue Bulletin

 2023-03Internal Revenue Bulletin of January 17, 2023

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Additional Resources

EY’s Tax News Update, 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:

EY’s Tax and Law Guides. — Tax and Law Guides | EY - Global 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.

 

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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