KPMG’s Week in Tax: 30 May - 3 June 2022

Tax developments or tax-related items reported this week include the following.

• Australia: The luxury car tax threshold will rise by 6.6% for fuel-efficient vehicles and 3.9% for other vehicles that are imported, acquired, or sold in the 2022-23 financial year.
• Australia: The Tasmania budget for 2022-2023 includes no new tax-related proposals, but does propose extensions to land tax relief measures and property transfer duty concessions. The budget also proposes to apply a foreign investor land tax surcharge to residential land that is not used as a principal place of residence and is acquired by a foreign person on or after 1 July 2022.
• Saudi Arabia: The relaunch of an amnesty initiative waives penalties on all taxes, including income tax, withholding tax, value added tax (VAT), excise tax and real estate transaction tax, from 1 June 2022 until 30 November 2022.
• UAE: As a result of changes in a new labor law governing the private-sector’s employment relations, employers operating in the UAE are required to take certain compliance actions. 
• Cambodia: All enterprises, companies, and factories under the scope of the Cambodian labor law are required to permit their employees and workers to take two days off for the 5 June 2022 Commune/Sangkat Council Election.
• India: The Supreme Court held that service tax is payable on the secondment of an employee to an Indian company from a foreign affiliated company because the secondment arrangement resulted in the supply of services by the foreign affiliated company to the Indian company.
• Singapore: The Inland Revenue Authority of Singapore this year officially launched two new tax governance programs to encourage companies, particularly large companies and multinational enterprises (MNEs), to demonstrate good tax governance by maintaining and improving their tax governance and control framework and bringing attention to tax matters to the board level. 
• Malaysia: The Inland Revenue Board of Malaysia issued the Tax Corporate Governance Framework (TCGF) and related guidelines to assist organizations in designing and operating their TCGF and encouraging voluntary participation in the TCGF program.

Read TaxNewsFlash-Asia Pacific

• Switzerland: The National Council recently approved revisions of the Swiss VAT law, including measures affecting electronic platforms. The earliest the revision of the VAT law might be effective is 1 January 2024.
• Germany: The Bundestag passed tax relief legislation that includes an energy-related lump-sum amount that is to be paid out by employers to their employees in September 2022.
• Germany:  The Bundestag adopted legislation to implement tax relief measures for coping with the COVID-19 pandemic. The legislation includes new measures as well as extensions of existing measures.
• Germany: The Federal Ministry of Finance (BMF) issued guidance regarding repayments of contributions by corporations domiciled in non-EU countries. Such guidance is applicable to all open cases. 
• Germany: The Federal Tax Court (BFH) held that the provision of the use of know-how for an unlimited period of time by a foreign taxpayer can result in income subject to non-resident tax liability, on which withholding tax is imposed.
• Sweden: The Court of Justice of the European Union (CJEU) held that city cards sold by a Swedish company to tourists who visit Stockholm are classified as “multi-purpose vouchers” for purposes of the EU Voucher Directive 2016/1065 of 27 June 2016, which has applied to EU Member States since 1 January 2019.
• Poland: The Ministry of Finance announced tax consultations on certain tax forms for use by individual taxpayers—the new PIT-38 (tax return on income/losses generated in a tax year) and PIT-8C (information on certain types of income from capital gains) forms. The existing forms had to be adapted to changes brought by the “Polish Deal” program. 
• Poland: The Supreme Administrative Court held that debts that have been sold are no longer treated as deductible because of being unrecoverable, meaning that they can be no longer charged into tax-deductible costs. However, they are subject to deduction as belonging to the sold debts category.
• Poland: The Supreme Administrative Court held that features of a fixed establishment of a taxpayer include sufficient permanence and adequate structure in terms of human and technical resources to receive and use such services for its own purposes.
• Slovakia: The tax administration announced measures to simplify and clarify taxpayer access to the Slovak financial administration portal—that is, the portal that can be used to verify taxpayer identification for purposes of electronic communications.

Read TaxNewsFlash-Europe

• East Africa: A KPMG report focuses on the trade and customs environment in East Africa to clarify compliance requirements in the context of import and export operations. 

Read TaxNewsFlash-Africa

• Canada: Saskatchewan’s Bill 82 received Royal Assent. The legislation includes a measure to enhance the value-added agriculture incentive.

Read TaxNewsFlash-Americas

• United States: KPMG LLP submitted comments to the IRS and Treasury Department with suggestions for how successor guidance to Rev. Proc. 2015-40 and Rev. Proc. 2015-41 could further improve the mutual agreement procedure (MAP) and advance pricing agreement (APA) programs. 

Read TaxNewsFlash-Transfer Pricing

• Barbados: The automatic exchange of information (AEOI) web portal for 2021 submissions opened on 1 June 2022 and will be available until 31 August 2022 to facilitate FATCA and common reporting standard (CRS) filings.

Read TaxNewsFlash-FATCA / IGA / CRS

• The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued Russia-related general licenses, and updated the specially designated nationals (SDN) list and the sectoral sanctions identifications (SSI) list.
• U.S. Customs and Border Protection (CBP) issued a release implementing a one-year suspension of Section 232 duties on imports of steel articles from Ukraine.
• CBP issued guidance on the tariff-rate quotas for steel and aluminum articles of the UK addressing quantity thresholds for 1 June 2022 through 30 June 2022.

Read TaxNewsFlash-Trade & Customs

The items described above are also reported as editions of TaxNewsFlash:

• Indirect Tax
• Taxation of the Digitalized Economy
• Tax Dispute Resolution
• Tax Developments Relating to Coronavirus (COVID-19)