April 18 (TPW) – US Treasury Secretary Jack Lew made headlines with his plans to curb corporate inversions and earnings stripping, a move that scuttled pharmaceutical giant Pfizer’s $160bn takeover of Dublin’s Allergan. But was Ireland the real beneficiary of the US inversion clampdown?
While taxes would have been processed through Allergan, in real terms the gains to the Irish exchequer would likely have been very limited. “Companies inverting into Ireland bring precious little employment with them. The inversion itself means establishing a head office presence which, in some cases, is little more than a brass plate,” The Irish Times reported.
TP Week’s Joelle Jefferis will have a special report later today on inversions and the ongoing struggle of American MNEs against the US tax code.
Jamaica considers Transfer Pricing legislation
April 18 (TPW) - New legislation involving Transfer Pricing should not be retroactive nor adversarial, Jamaica Finance Minister Audley Shaw told a meeting involving his tax teams and Ian Woods, an Advance Pricing Agreement (APA) expert with ties to the OECD.
Wood, who wrapped up a five-day visit to the island last week, held high-level discussions with the Ministry's Taxation technical team, the Institute of Chartered Accountants, the Jamaica Hotel and Tourism Association, and others. Discussions focused on potential bi-lateral agreements with government agencies and the application of a Transfer Pricing provision, according to reports in the local media.
ICC ‘Concerned’ About European Commission’s Last-Minute ‘Tax Haven’ Plan
April 18 (TPW) - The International Chamber of Commerce is concerned that the European Commission may be rushing plans that would force MNEs to publicly disclose offshore earnings and tax bills, noting the EU hasn’t yet agreed on the definition of a “tax haven”.
The EC “proposal include a last-minute addition requiring corporations to disclose tax data in jurisdictions deemed as ‘tax havens’ - despite there being no consensus within the EU states on what constitutes a tax haven,” the ICC said in a statement on their website.
The Commission’s plan for country-by-country (CbC) reporting would require large companies to publish tax data for every EU jurisdiction in which they operate and an aggregated breakdown for worldwide operations. The proposal also breaks new ground in relation to CbC reporting standards by stipulating seven data points that will be put into public registers, broken down by country: taxes paid, taxes due, pre-tax profit, revenue, number of employees, business profile and accumulated earnings.
South Africa drafts CbCR regulations
April 18 (TPW) - The South African Revenue Service (SARS) is asking for comments on its draft legislation for CbCR.
The legislation implements CbCR in line with the OECD BEPS project recommendations under Action 13. The South African parent company of MNEs with a net turnover of ZAR 10 billion ($685 million) will be required to file CbCR in South Africa on financial years starting on or after January 1 2016.
SARS are open for comments on the draft legislation until May 3.