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  • Service: Tax & Legal, International Corporate Tax
  • Type: Publication series
  • Date: 2/1/2014

International Tax – Asia Pacific region (1 February and 28 February 2014) 

 

This e-newsletter gives you an overview of international tax developments being reported globally by KPMG firms in the Asia Pacific & Middle East and South Asian regions between 1 February and 28 February 2014.

Asia Pacific

Hong Kong

Pakistan

Taiwan

Australia

India

Qatar

Turkey

Cambodia

Jordan

Saudi Arabia

United Arab Emirates

China

Middle East

Singapore

Vietnam

Cyprus

Oman

Sri Lanka

 

 

 

Tax area concerned

Relevant date

Description of measures and publication link
(Considerations in italic where necessary)

Asia Pacific

Tax legislation adopted and regulatory update

ASEAN Economic Community

Beginning 2015

Beginning 2015, the 10 member countries of ASEAN will form a common market—the ASEAN Economic Community (AEC)—based on the free flow of goods, services, investment, and skilled labour and the freer flow of capital.
Read more

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Australia

Tax legislation adopted and regulatory update

Various tax areas

February 2014

KPMG in Australia prepared reports on the following developments:

Australian R&D for foreign companies

BEPS: Dutch Supreme Court draws line on RPS issued by Australian company

To block or not to block – super investor's dilemma

Is everyone singing the same tax power ballad?

Read more

KPMG in Australia prepared reports on the following developments:

sovereign immunity exemption remains nebulous

petroleum resource rent tax

withholding on technology-related payments

Australian insurance duty

Global tax transparency

Read more

KPMG in Australia prepared reports on the following developments:

Has your tax sharing agreement had its annual service?

Beneficial ownership: unexploded grenade in the global tax treaty network?

Part IVA: The song remains the same… or does it?

Read more

KPMG in Australia prepared reports on the following developments:

design R&D expenditure

additional method to calculated monthly PAYG installments

removal of CGT discount for foreign residents.

Read more

Transfer pricing

2013

Australian taxpayers are already subject to extensive transfer pricing recordkeeping rules, following last year’s passage of Tax Laws Amendment (Countering Tax Avoidance and Multinational Profit Shifting) Act 2013, and also may be subject to significant disclosure requirements such as the International Dealings Schedule.
Read more

Proposed legislation

Group financing

1 July 2014

The proposed repeal of section 25-90 triggered a flurry of (now redundant) activity in Australian multinational groups, as they looked to understand the use of loan funds.
Read more

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Cambodia

Tax legislation adopted and regulatory update

Treatment of interest expense

22 January 2014

Cambodia’s tax authority issued guidance—Instruction Circular no. 151GDT (22 January 2014)—to explain further how interest expenses will be treated for tax purposes.
Read more

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China

Treaties

DTT

1 January 2015

An income tax treaty, and Protocol, between China and France was signed in late November 2013.
Read more

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Cyprus

Tax legislation adopted and regulatory update

VAT

13 January 2014

The rates of VAT in Cyprus are:

The “standard” VAT rate is 19 percent (increased from 18 percent) effective 13 January 2014.

The “reduced” VAT rate is 9 percent (increased from 8 percent) effective 13 January 2014.

Read more

KPMG publications

Various tax areas

2014

A “tax guide” for 2014 provides an overview of the tax system in Cyprus and information for non-resident investors and corporations in Cyprus.
Read more

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Hong Kong

Tax legislation adopted and regulatory update

Stamp duty

27 October 2012

Hong Kong’s Legislative Council passed a bill to amend the stamp duty as imposed on residential property transactions.
Read more

Proposed legislation

Budget

2014-2015

Hong Kong’s budget 2014-2015, presented 26 February 2014, contains tax proposals that would affect the financial services sector.
Read more

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India

Tax legislation adopted and regulatory update

Direct taxes

February 2014

KPMG in India prepared reports on the following developments:

expenditure incurred in relation to exempt income disallowed

revised PAN allotment process change.

Read more

Administrative and case law

Various tax areas

February 2014

Case law has been published in India with respect to the following subjects:

no AAR jurisdiction unless there has been a transaction or proposed transaction (not a mere intention)

R&D deduction available even though approval not signed by appropriate authority

payments to a Philippine company for business information services are not taxable, absent a FTS clause under the income tax treaty and absent a PE in India.

Read more

Transfer pricing

DCIT v. GE BE Ltd. ITA [No.
815/Bang/2010)

The Bangalore Bench of the Income-tax Appellate Tribunal found that the Cost Plus Method was the most appropriate method for contract manufacturers.
Read more

Lever India
Exports Ltd.
v. ACIT
(ITA No .7089/MUM/
2010)  

The Mumbai Bench of the Income-tax Appellate Tribunal upheld an administrative action by the Commissioner of Income-tax (Appeals), to reject a proposed transfer pricing adjustment for advertising expenses reimbursed by the taxpayer to its related entities because the advertising expenses were related to the taxpayer’s export activity and because the Transfer Pricing Officer had accepted that the taxpayer’s export activity was at arm’s length.
Read more

Various tax areas

February 2014

Case law has been published in India with respect to the following subjects:

indian subsidiary of a foreign company providing “back office” support is not a PE in India

Supreme Court on application before AAR when the income tax return already been filed.

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Jordan

Tax legislation adopted and regulatory updates

Indirect taxes

2014

Jordan has increased the rates of certain indirect taxes, including:

clean energy manufacturing inputs

imported clothes

cell phones and tablets

interest earned by insurers

classifying business activities.

Read more

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Middle East

Other

Investors’ top tax concerns

2014

KPMG’s New MESA Head of Tax outlines investors’ top tax concerns.
Read more

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Oman

Tax legislation adopted and regulatory update

Withholding tax on software

February 2014

The Oman tax authority has focused on withholding tax on software and whether a payment to acquire software would be categorized as a “royalty” or as “consideration for use or right to use of software.”
Read more

Compliance requirements

31 March 2014

For companies in Oman with fiscal years ending 31 December 2013, the due date for filing Provisional Returns of Income and tax payments is 31 March 2014.
Read more

Proposed legislation

Budget

2014

The Oman government’s 2014 budget was presented.
Read more  

Treaties

DTT

9 January 2014

The governments of Japan and Oman signed a new tax treaty on 9 January 2014.
Read more

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Pakistan

Tax legislation adopted and regulatory update

Tax incentives

1 January 2014

The Prime Minister announced a tax incentive and amnesty package in late November 2013.
Read more

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Qatar

Tax legislation adopted and regulatory update

Transfer pricing

February 2014

The Qatar Financial Centre tax authorities issued a transfer pricing manual that features non-binding guidance with respect to Qatar’s transfer pricing regulations and rules.
Read more

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Saudi Arabia

Tax legislation adopted and regulatory update

Various tax areas

2013-2014

KPMG in Saudi Arabia prepared a report on developments of interest to foreign investors.
Read more

Treaties

DTT

1 January 2014

An income tax treaty between Saudi Arabia and Tunisia has entered into force and is effective 1 January 2014.
Read more

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Singapore

Tax legislation adopted and regulatory update

R&D

February 2014

Singapore’s R&D tax incentive regime provides an enhanced tax deduction to businesses investing in R&D and a possible 60 percent “cash payout” on qualifying expenditures up to $100,000 (approximately US$78,000).
Read more

Proposed legislation

Budget

2014

Singapore’s 2014 budget statement reflects the following tax proposals:

productivity and innovation credit scheme

extending R&D tax incentives

write downs of allowances on intellectual property rights

deductions for qualifying intellectual property

registration costs

land intensification allowance scheme

waiver of withholding tax on payments to Singapore branches

extending and refining tax incentive scheme for qualifying funds / recovery of GST for qualifying funds

refining the designated unit trust scheme

treating Basel III additional Tier 1 instruments as debt for tax purposes

scheme for listed infrastructure registered business trusts

tax concessions for real estate investment trusts.

Read more

Treaties

Free trade agreement

1 September 2013

Reports indicate that the member countries of the Cooperation Council for the Arab States of the Gulf (GCC)—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates—were preparing in early 2014 to sign a comprehensive free trade agreement with Singapore.
Read more

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Sri Lanka

Proposed legislation

Budget

2014

The Sri Lankan government’s 2014 budget was presented in late November 2013.
Read more

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Taiwan

Tax legislation adopted and regulatory update

Income tax on royalties & fees for technical services

1 January 2011

An amendment concerns the rules governing taxpayers (including foreign for-profit entities) that apply for an exemption from income tax on royalties and technical service fees related to the manufacturing, technical service, and energy-generating industries.
Read more

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Turkey

KPMG publications

Transfer pricing

2007

Since the release of transfer pricing regulations in 2007, transfer pricing has been a focus for both corporate taxpayers and the tax authorities in Turkey. The APA program in Turkey is an important part of the transfer pricing regulations, in that the APA program is considered to offer a valuable solution and a proactive approach for addressing transfer pricing risks. KPMG in Turkey has prepared a 12-page report that examines the APA process in Turkey.
Read more

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United Arab Emirates

Tax legislation adopted and regulatory update

Tax transparency

2014

UAE participates in OECD’s tax transparency forum.
Read more

Property transfer fees

2014

The government of Dubai has increased property transfer fees to 4 percent (from 2 percent charged earlier). The fee is to be collected from both the seller and the buyer equally, unless otherwise agreed by the parties.
Read  more

Treaties

FATCA IGA

January 2014

Reports from the United Arab Emirates reveal that in late January 2014, representatives of the United States and the UAE were preparing to sign an intergovernmental agreement to implement provisions under U.S. law known as FATCA.
Read more

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Vietnam

Tax legislation adopted and regulatory update

Individual income tax

2013

Vietnam’s General Department of Taxation in late January 2014 issued an “official letter” providing guidance on the individual income tax finalization rules for 2013.
Read more

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For a full summary of global tax developments, visit kpmg.com/TaxNewsFlash.

 

Contacts:

Anna Voronkova
Partner,
Head of International Tax
+7 (495) 937 44 24


Evgenia Wolfus
Partner,
International Tax
+7 (495) 937 44 19


Alexander Tokarev
Senior Manager,
International Tax
+7 (495) 937 44 77


Olga Ermolaeva
Senior Manager,
International Tax
+7 (495) 937 44 77


Elena Dolgova
Manager,
International Tax
+7 (495) 937 44 77