23 August 2024

 
 
 

UN Approves Draft Terms of Reference

Following the conclusion of the Second Session of the Ad Hoc Committee to Draft Terms of Reference for a United Nations Framework Convention on International Tax Cooperation, the UN released the final approved draft terms of reference (ToR). The final draft is expected to be presented to the General Assembly in November or December this year, where a final decision will be made on whether to proceed to the negotiation phase for the Framework Convention.


As Regfollower reported, the adopted draft ToR "clarify that the Framework Convention should include a clear statement of its objectives, establishing a system of governance for inclusive international tax cooperation that can respond to existing and future challenges. It should establish an inclusive, fair, and transparent international tax system for sustainable development, addressing issues around the strengthening of domestic resource mobilization." [More Information]

 

IMF and OECD News

 

International Monetary Fund

Last week, the IMF released How Widespread is FDI Fragmentation?, a new working paper (No. 2024/179) that "examines the extent to which FDI has fragmented across countries, the ways it has done so, using a modified gravity approach." In a related publication, fDi Intelligence highlighted the latest findings in its ninth edition Greenfield FDI Performance Index, with the UAE listed as "world’s best FDI performer relative to the size of its economy in 2023."

Organisation for Economic Co-operation and Development

The OECD and IGF recently released a new practical guidance framework to support developing countries when addressing the transfer pricing challenges faced when pricing lithium. Determining the Price of Minerals: A Transfer Pricing Framework for Lithium "identif[ies] the primary economic factors that influence the price of lithium in applying the Comparable Uncontrolled Price method and ensure that developing countries are able to tax lithium exports appropriately." [Press Release]

 

A Closer Look...

 

Tax Liabilities and the Changing Tax Landscape

A recent article published by Bloomberg Tax considers the UN's recent efforts to create a new tax treaty compared to the OECD's role in creating the existing international tax system, and how any "changes in international tax rules...will affect businesses’ tax liabilities, including through increased withholding taxes and other source-based taxes."


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Sustainable Tax Principles and the Energy Transition

Mining Journal recently published an op-ed highlighting the "strong and abiding link between ‘responsible mining' and sustainable tax principles." As part of their analysis, the authors highlighted "six wide-ranging tax design elements...which should be considered by tax policy makers to drive sustainable taxation and facilitate efficient, sustainable mining projects."

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Country Updates

 

BAHRAIN Updates VAT Guides -- KPMG provided more information on the

updated VAT general guide and financial services guide recently published by Bahrain's National Board of Revenue.

CANADA Launches Budget 2024 Public Consultation -- Regfollower reported on the recent public consultation launched by Canada's Department of Finance "to advance key budget priorities to build more homes, boost economic growth, improve tax fairness, and ensure Canada’s financial sector works for all Canadians."

CHINA's Continued Progress to Address Tax Certainty and APAs -- A recent EY Global Tax News Update provided a detailed summary of the progress underway in China as major cities (namely Shanghai and Beijing) continue to actively implement an advance tax ruling system.

FINLAND Begins Pillar Two Consultation -- Regfollower recently reported on the latest public consultation in Finland regarding specific proposed changes to the Minimum Tax Act.

INDIA Enacts 2024 Finance Act -- Regfollower provided a detailed overview of the 2024 Finance Act recently enacted in India, including several amendments aimed at reforming various tax laws. Additionally, ITR recently featured an article highlighting India's progress on implementing the OECD's two-pillar solution after the Finance Minister's latest Union Budget presentation.

IRELAND Tax Updates -- Two recent Regfollower articles provided more information on new eBriefs issued by Irish Revenue related to administering the Pillar Two global minimum tax (No. 213/24) and the Guide to Exchange of Information (No. 210/24).

KENYA Tax Reform Update -- Regfollower provided more information on recent remarks by Kenya’s new Cabinet Secretary for the National Treasury and Economic Planning "reaffirm[ing[ the government’s commitment to boosting revenue collection and ensuring efficient financial management to drive Kenya’s economic growth."

MALAYSIA Tax Developments -- KPMG released a detailed overview of the latest income tax and indirect tax developments in Malaysia.

New Capital Market Incentives Program Launched in OMAN -- A recent EY Global Tax News Update provided a detailed overview of the new Capital Market Incentives Program introduced in Oman.

SAUDI ARABIA Approves Updated Investment Law -- Regfollower provided more information on the Updated Investment Law recently approved in Saudi Arabia, which "aims to attract foreign investors, enhance the competitiveness of the investment environment, support economic diversification, and create job opportunities, all in alignment with Vision 2030 and the goals of the national strategy."

SWEDEN Proposes Changes to Additional Tax Act -- Regfollower provided a brief overview of the latest amendments proposed by Sweden's Ministry of Finance to the Act on Additional Tax to more closely align with the EU's global minimum tax directive.

UNITED ARAB EMIRATES Tax Updates -- A recent PwC Tax & Legal News Update provided more information on the new Corporate Tax Guide on Determination of Taxable Income released by the UAE Federal Tax Authority (FTA). Additionally, Regfollower provided further background on the public clarification recently issued by the FTA relating to the first tax period of a newly established company.

Fiscal Framework in the UNITED KINGDOM -- A new IMF Public Financial Management blog post highlighted a recent report published by the Institute for Government that analyzes "problems with UK fiscal policy and whether changes to the rules or how they are used could help." The author concludes that "…our analysis suggests that fiscal rules are an important and inevitable part of any robust fiscal framework. But they only work if they support broader, coherent fiscal objectives and are complemented by other aspects of the fiscal framework."

VIETNAM Tax Updates -- KPMG and Regfollower both provided detailed overviews of the latest tax developments in Vietnam, including changes to corporate income tax rules, individual income tax, invoicing, and tax administration.

 

Latest ADIT Results Announced

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The Chartered Institute of Taxation recently announced that more than "500 international tax professionals have successfully passed exams for the Chartered Institute of Taxation’s ADIT (Advanced Diploma in International Taxation) qualification," with students from Bangladesh and Colombia achieving the qualification for the first time.

 

The ITICnet.org Weekly Round-Up will be published biweekly in July and August. Our next issue will be published on 6 September.