Tax News Update    Email this document    Print this document  

June 25, 2023

U.S. International Tax This Week for June 23

Ernst & Young's U.S. International Tax This Week newsletter for the week ending June 23 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.


The Senate on 22 June gave its advice and consent to the 2010 US-Chile Income Tax Treaty in a 95-2 vote. Once the Treaty enters into force, the withholding provisions would become effective for amounts paid or credited on or after the first day of the second month following the date of entry into force. For all other taxes, the provisions will take effect for tax periods beginning on or after the first day of January following the date the Treaty enters into force. The Treaty includes two reservations and two declarations; the reservations concern the Base Erosion and Anti-abuse Tax (BEAT) and Article 23 (Relief from Double Taxation). The government of Chile undertook all the steps necessary to approve the Treaty in 2015. It is anticipated that the reservations added since then would need to be reviewed and ratified by Chile's Senate so the Treaty could take effect in Chile. An EY Tax Alert is pending.

Congressional Republicans this week released a Joint Committee on Taxation (JCT) analysis of five possible scenarios regarding adoption of the OECD Pillar Two global minimum tax by the US and globally. The JCT report concludes that depending on the scenario — the US adopts and/or the rest of the world adopts Pillar Two with various combinations — the US could lose as much $120 billion in revenue over 10 years (if the US does not adopt Pillar Two, but the rest of the world adopts) or gain $236 billion over the period (in the unlikely situation the US adopts Pillar Two in 2025, but the rest of the world does not adopt). A WCEY Alert provides details.

Significant developments are anticipated in the next few weeks on both BEPS Pillar One and Pillar Two. While a multilateral convention to implement Pillar One is targeted for finalization by July 2023, it is not clear whether policy makers will solve all outstanding technical and political issues in the time that remains. In any case, the Inclusive Framework will meet shortly before the G20 Finance Ministers meet in Gandhinagar on 14-15 July. This is expected to be a key meeting to reach an important milestone in the Pillar One project.

The meeting may also be an opportunity to formalize agreement on a number of outstanding issues and workstreams in relation to Pillar Two. For example, the Inclusive Framework members have been negotiating for some time on the method and criteria for Pillar Two peer reviews. Additional administrative guidance for Pillar Two is also expected.

Upcoming Webcasts

Finance and treasury: How to navigate the changing global tax landscape (June 28)
During this EY Webcast, Ernst & Young professionals will discuss key tax trends and topics that will affect global finance and treasury activities.

BorderCrossings … with EY transfer pricing and tax professionals (June 29)
During this EY Webcast, Ernst & Young transfer pricing and tax professionals will help you stay informed and able to adopt a more proactive stance in developing and defending your transfer pricing policies and practices.

Recent Tax Alerts

United States

— Jun 22: Senate approves Chile tax treaty resolution (Tax Alert 2023-1118)

— Jun 20: JCT estimates of OECD-led tax deal Pillar Two released (Tax Alert 2023-1100)

— Jun 16: USCIS expands premium processing to change of status requests for applicants seeking F, M, or J status (Tax Alert 2023-1076)


— Jun 19: Ghana Revenue Authority issues 'Practice Note on Taxation of Gross Gaming Revenue and Winnings from Lottery Operations' (Tax Alert 2023-1091)


— Jun 22: Hong Kong simplifies application process for seeking tax residence certificates (Tax Alert 2023-1115)

— Jun 21: Taiwan amends the Assessment Rules for withholding tax mitigation regime (Tax Alert 2023-1106)

Canada & Latin America

— Jun 19: Canada's proposed regulations amend valuation for duty rules for imported goods (Tax Alert 2023-1092)

— Jun 19: Costa Rica Executive Branch publishes Regulations to the General Customs Law (Tax Alert 2023-1089)


— Jun 22: Switzerland agrees to partial revision of VAT Act (Tax Alert 2023-1124)

— Jun 22: Italian Revenue Agency issues ruling on VAT fixed establishment intervention (Tax Alert 2023-1120)

— Jun 22: UK Government announces new 'Developing Countries Trading Scheme' (Tax Alert 2023-1117)

— Jun 22: Czech Republic's major amendments to immigration regulations to go into effect on 1 July 2023 (Tax Alert 2023-1116)

— Jun 21: Montenegro begins issuing visas and residence permits to digital nomads (Tax Alert 2023-1109)

— Jun 21: Luxembourg Tax Authority publishes guidance on the computation of taxable income of Reverse Hybrid Entities (Tax Alert 2023-1108)

— Jun 20: European Commission publishes draft Directive on Faster and Safer Relief of Excess Withholding Taxes (FASTER) (Tax Alert 2023-1097)

— Jun 20: European Union to launch new online Schengen Visa application process (Tax Alert 2023-1096)

— Jun 20: German Ministry of Finance issues updated Administrative Principles regarding Transfer Pricing (Tax Alert 2023-1095)

— Jun 20: Switzerland votes to amend Constitution to allow Pillar Two implementation (Tax Alert 2023-1094)

— Jun 16: Brazil transfer pricing law enforceable beginning 1 January 2024 (Tax Alert 2023-1078)

— Jun 16: Azerbaijan amends Immigration Code (Tax Alert 2023-1075)

Middle East

— Jun 20: Saudi Arabia announces sixth wave of Phase 2 e-invoicing integration (Tax Alert 2023-1099)


— Jun 22: Australian thin capitalization and subsidiary disclosure measures introduced into Parliament (Tax Alert 2023-1122)

IRS Weekly Wrap-Up

Internal Revenue Bulletin

 2023-26Internal Revenue Bulletin of June 26, 2023

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.