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June 30, 2023

U.S. Tax This Week for June 30

Ernst & Young's U.S. Tax This Week newsletter for the week ending June 30 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

OECD releases 2023 update on peer review of preferential tax regimes

On 21 June 2023, the Organisation for Economic Co-operation and Development (OECD) released an update on the results of the peer reviews of jurisdictions' domestic laws under Action 5 (harmful tax practices) of the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project. The Inclusive Framework on BEPS approved the results on 9 June 2023. The updated results cover new decisions on five preferential tax regimes. According to the press release, a total of 319 tax regimes have been reviewed, or are under review by the Forum on Harmful Tax Practices (FHTP). This latest review reflects that three regimes have been abolished (one for Aruba and two for San Marino). Additionally, a regime for Jordan has been amended to align with the standard and is now considered nonharmful, and a regime for Albania is currently in the process of being amended. No regimes are identified as currently under review. EY Tax Alert 2023-1136 has details.

OECD releases 2023 report on tax transparency in Latin America

On 27 June 2023, the Organisation for Economic Co-operation and Development (OECD) published a progress report, "Tax Transparency in Latin America 2023," in connection with the eighth meeting of the Punta del Este Declaration, an initiative established in 2018 and focused on improving effective exchange of information in tax administrations in Latin America. The report provides an update on the progress achieved to date and describes how jurisdictions in the region have developed and implemented a strategy to increase the use of exchange of information as a tool to support audits and investigations using the international network and the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum). EY Tax Alert 2023-1174 has details.

EY Guides and Publications

BEPS 2.0 | Pillar Two Developments Tracker
This Tracker is intended to provide a summary listing of administrative and legislative developments around the world relating to the implementation of the global minimum tax rules being developed under Pillar Two of the OECD/G20 BEPS 2.0 project. It provides an overview of developments in various jurisdictions, including the dates on which the relevant authorities, institutions, or legislative bodies have made public announcements or released official documents related to Pillar Two.

State corporate income and franchise tax developments in the second quarter of 2023
This Tax Alert provides a summary of the significant legislative, administrative and judicial actions that affected US state and local income/franchise and other business taxes for the second quarter of 2023. These developments are compiled from the EY Indirect/State Tax Weekly and Indirect/State Tax Alerts issued during that period.

Upcoming Webcasts

How BEPS 2.0 could impact the wealth & asset management industry (July 13)
Although it is generally expected that the Organisation for Economic Co-operation and Development’s BEPS 2.0 initiative will have a limited direct impact on the investment fund industry, the Pillar Two model rules’ reliance on the accounting consolidation rules to determine whether a group exists will pose additional challenges when determining the scope of these rules. This EY webcast will examine how the Pillar Two rules may apply to the wealth & asset management industry and will highlight practical considerations.

Latest guidance related to IRA and IIJA tax incentives and grants (July 14)
Now that companies have begun claiming tax credits and grants under the Inflation Reduction Act of 2022 (IRA) and the Investment, Infrastructure and Jobs Act (IIJA), many have questions about the incentives’ requirements, as well as their applicability, timing and disbursement process (which may be time-sensitive). During this EY Webcast, we will review recent guidance issued by administrative authorities to help you identify, secure and comply with the requirements for these tax credits, grants and other subsidies. Please join our panelists for an in-depth discussion of these incentives.

Recent Tax Alerts

Internal Revenue Service

— Jun 29: IRS effectively extends due date for certain taxpayers for returns and payment of stock repurchase excise tax (Tax Alert 2023-1166)

— Jun 28: IRS denies taxpayer's 9100 relief request to make a late safe harbor election to deduct 70% of a success-based fee under Revenue Procedure 2011-29 (Tax Alert 2023-1156)


— Jun 30: Spanish immigration authorities clarify foreign students’ ability to work in Spain (Tax Alert 2023-1176)

— Jun 30: South Africa further extends deadline for Zimbabwe Exemption Permit holders to change immigration status (Tax Alert 2023-1175)

— Jun 30: Kenya rolls out new tax return template to capture data on intercompany transactions for MNEs (Tax Alert 2023-1170)

— Jun 30: Rwanda presents the national budget for financial year 2023/24 (Tax Alert 2023-1169)

— Jun 29: Israeli court favors Tax Authority's position on deemed sale of IP (Tax Alert 2023-1167)

— Jun 29: Canada's Department of Finance releases transfer pricing rules consultation paper (Tax Alert 2023-1164)

— Jun 29: Belgium-Netherlands tax treaty recently signed; ratification to follow (Tax Alert 2023-1163)

— Jun 29: Canada announces new Tech Talent Strategy (Tax Alert 2023-1162)

— Jun 29: European Union's framework agreement on social security for cross border telework comes into force as of 1 July (Tax Alert 2023-1159)

— Jun 29: Bulgaria proposes to continue measures addressing high energy prices affecting electricity providers (Tax Alert 2023-1158)

— Jun 28: Ireland brings public country-by-country reporting requirements into effect (Tax Alert 2023-1155)

— Jun 28: Kenya High Court clarifies 'use of an asset' definition for purposes of claiming of investment allowance (Tax Alert 2023-1152)

— Jun 28: Canada enacts 2023 Budget implementation bill no. 1 (Tax Alert 2023-1151)

— Jun 26: Australian Treasury releases updated Exposure Bill and Explanatory Materials for Intangibles Integrity Measure (Tax Alert 2023-1145)

— Jun 26: Uruguay temporarily reduces VAT and IMESI rate for mineral and sparkling waters (Tax Alert 2023-1141)

— Jun 26: Japan promulgates 2023 tax reform enforcement order to implement IIR to align with OECD BEPS 2.0 Pillar Two (Tax Alert 2023-1140)

— Jun 23: UAE extends registration timeline for the mandatory unemployment insurance program (Tax Alert 2023-1135)

— Jun 23: European Commission proposes adjusted package for the next generation of 'own resources' (Tax Alert 2023-1133)

— Jun 23: Denmark postpones deadlines for certain annual corporate income tax returns and transfer pricing documentation (Tax Alert 2023-1129)


— Jun 23: Senate Banking Committee approves bill clawing back compensation from executives of failed banks, 21-2 (Tax Alert 2023-1131)

— Jun 23: What to expect in Washington (June 23) (Tax Alert 2023-1130)


— Jun 28: Colorado law creates new SUI surcharge and eliminates requirement for SUI premium reports; 2023 SUI tax rates unchanged but wage base increased (Tax Alert 2023-1153)

— Jun 27: Wisconsin repeals tangible personal property tax starting in 2024 and allows Milwaukee to increase its sales tax (Tax Alert 2023-1149)

— Jun 26: Nevada's Modified Business Tax to decrease effective July 1, 2023 (Tax Alert 2023-1142)

— Jun 26: California will require state disability insurance contributions on all covered wages starting in 2024 (Tax Alert 2023-1134)

Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

Texas enacts incentives program to replace expired Ch. 313 School Value Limitation Program On June 9, 2023, Texas Governor Greg Abbott signed HB 5, the "Texas Jobs, Energy, Technology, and Innovation Act," replacing the Texas Chapter 313 School Value Limitation Program, which expired on Dec. 31, 2022.

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

ITS/Washington Dispatch
   Highlights of this edition include:

US Congress

  • House Ways and Means Republicans release tax package
  • Congressional JCT provides revenue estimates for BEPS 2.0 Pillar Two

Treasury and IRS news

  • IRS waives addition to tax for a corporation’s failure to make estimated tax payments of its CAMT
  • IRS plans further IP guidance

Tax Treaties

  • US Senate approval of US-Chile tax treaty brings treaty closer to entry into force

OECD Developments

  • BEPS 2.0 Project enters critical stage
  • OECD releases 2023 update on peer review of preferential tax regimes

IRS Weekly Wrap-Up

Final Regulations

 TD 9972Electronic-Filing Requirements for Specified Returns and Other Documents; Correction

Proposed Regulations

 REG–110412–23Additional Guidance on Low-Income Communities Bonus Credit Program; Correction
 REG–124123–22Corporate Bond Yield Curve for Determining Present Value


 2023-18Transitional Guidance with Respect to Stock Repurchase Excise Tax

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.