International review for March

International review for March

Tim Sarson’s latest summary of international developments.

Tim Sarson

Partner, UK Head of Tax Policy

KPMG in the UK


Progress appears to have been made on the EU’s ‘public’ Country by Country Reporting proposals with long-standing disagreements on their legal basis being overcome by a ‘compromise text’. Across Europe, tax authorities focused on tackling fraud; and Germany introduced tougher transfer pricing documentation requirements for cross-border transactions between related parties. Governments around the world continued to extend assistance for businesses amongst the pandemic, but tax rises are on the horizon with wealth taxes considered across Latin America and the UK announcing an increase to its corporation tax rate. There was a renewed sense of optimism that the OECD may reach agreement on taxation of the digital economy by mid-2021 following news that the new US administration had dropped its ‘safe harbour’ request. In India, the Supreme Court held payments to foreign software manufacturers for resale or use are not royalty payments and therefore not subject to withholding tax.

In the latest of his regular articles for Tax Journal*, Tim Sarson looks back at some of the interesting developments that unfolded in March in the international tax arena. This article includes updates on the following:

  • The EU’s ‘public’ Country by Country Reporting proposals.
  • Tax authority audit trends.
  • COVID-19 measures.
  • Tax rates and global competitivenes·
  • Taxation of the digital economy.
  • An Indian Supreme Court judgment regarding payment to foreign software manufacturers for resale or use.

* First published by Tax Journal on 27 March 2021. Reproduced with permission.

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