Author: Дмитрий Батраков

The Government of Canada has announced its intention to reduce the tax burden on small businesses and amend the forthcoming reforms in the field of tax planning. The innovations include the reduction in the tax rate for small businesses from 10.5% to 10% from January 1, 2018, and after January 1, 2019 - to 9%. According to the government forecasts, the reforms for the period up to 2022-2023 will save up to 2.9 billion Canadian dollars, which is equal to 2.3 billion US dollars). The previous conservative government in 2015 provided for the reduction in the tax rate for the next few years, down to 9% by 2019, however in 2016, these reforms were postponed. It is assumed that after the introduction of changes, Canada will have the lowest tax rate on small enterprises among the G-7 countries. So, the application of a 9 percent tax rate on the federal small business will result in a decrease in the aggregate average provincial-territorial tax from 14.4 percent to 12.9 percent. The current government will also take measures against using the status of Canadian Controlled Private Corporation (CCPC), in order to reduce the income tax obligations of employees with high wages. The...

The four parties forming the new government of the Netherlands have signed an official coalition agreement - the Programme of Action for 2017-2021, which includes important changes in tax legislation. The innovations in the system of corporate and personal income taxation are aimed at increasing the competitiveness of the Netherlands and preventing money laundering. The agreement assumes that the standard corporate tax rate will be gradually reduced from 25% to 21%, and a 20 percent rate of corporate income tax of up to 200,000 euros ($ 237,000) will be reduced to 16%. Another change is the partial cancellation of a 15 percent tax on dividends in order to increase the volume of foreign investment. However, to counteract the creation of “mailbox companies”, the government plans to introduce a withholding tax on interest payments and royalties in jurisdictions with a low level of taxation. Confirming its commitment to the OECD recommendations on BEPS and promoting the equity participation financing, the coalition intends to limit deductions for interest payments. The authorities also support the creation of the blacklist of jurisdictions with improper...

The National Bank of Ukraine continues to simplify the business environment and the work of banking institutions in accordance with the requirements of the Law of Ukraine “On Amendments to certain legislative acts of Ukraine on the use of seals by legal and physical persons-entrepreneurs”. The changes are made to a number of NBU regulations providing for the removal of some bureaucratic obstacles. So, in accordance with the innovations, the clients of the authorized banks that wish to conduct a currency transaction will no longer need to seal the documents which are necessary for carrying out this transaction. In addition, the demand regarding the certification with the seal of the documents submitted to the NBU is canceled. And, in a number of cases, it is no longer necessary to notarize the originals or copies of the documents for conducting currency transactions. At the same time, the translations of contracts and other documents submitted by the banks and their clients to the National Bank still must be certified by a notary. These steps are fixed by the Decree No.102 of October 10, 2017 “On Amendments to certain legal acts of the National Bank of Ukraine” and...

On Monday, October 9, Deputy Minister of Finance of Ukraine Sergey Marchenko and the Minister of Economy of the Republic of Turkey Nihat Zeibekci signed the Protocol on amendments to the Agreement on avoidance of double taxation between the two states. The adopted innovations will allow physical and legal persons to avoid paying double taxes on the income received in the territories of Ukraine and Turkey. This can be achieved with the help of the distribution of the right to tax certain types of income depending on the place of their origin between the two countries, as well as by taking into account the taxes paid in the territory of another state in the tax obligations of the taxpayer of one state. It is expected that the changes will create better conditions for the investors of both jurisdictions and they will increase the entrepreneurial initiative. The settlement of the issue of international taxation of income in bilateral relations between Ukraine and Turkey will help eliminate tax discrimination, as well as establish cooperation between the tax authorities of the states and the exchange of tax information. The signed Protocol provides: expansion of the meaning of the...

The Federal Council of the Swiss Confederation adopted the Ordinance on the automatic exchange of country-by-country reports, which will enter into force on December 1, 2017 as an addition to the Federal Law on the automatic exchange of country-by-country reports of the transnational companies. It should be mentioned that this Law and the Multilateral Agreement of the competent authorities on the exchange of the intercountry reports to date are the legislative base of Switzerland for the automatic exchange of financial information with other states. The adopted Ordinance introduces a requirement for transnational companies that operate in Switzerland, to compile country-by-country reports on an annual basis starting in 2018, as well as fixes the content of these reports. Switzerland will begin the exchange of country-by-country information in 2020. As the Federal Council assures, this decision is designed to bring the legal basis of the state in line with one of the international standards for preventing the base erosion and profit shifting, the purpose of which is to ensure transparency of taxation of transnational companies and the development of a unified concept for the...

In connection with the leaving of the UK from the European Union, one of the largest Singaporean banks, Oversea-Chinese Banking Corporation, is planning to open its branch in Luxembourg. Earlier, the European branch of OCBC was located in London, which allowed the bank to manage affairs in the EU. Now the banking corporation is considering Luxembourg as a convenient place for doing business, where it intends to open a new branch. The implementation of this plan will be a very significant event in the financial history of the Grand Duchy. However, it should be noted that the decision is not final yet and the bank is also considering other jurisdictions. It is expected that the situation will become clear after the announcement of the results of the meeting of the Executive Director of OCBC Bahrain Shaari and the Prime Minister of the Grand Duchy Xavier...

On August 27, 2017, the president of the UAE signed a law presupposing a change in the tax legislation of the country, namely, the introduction of a value-added tax. This decision was made within the framework of the economic policy of the closed international organization CCASG, which also includes Bahrain, Oman, Kuwait, Qatar and Saudi Arabia. According to the Law, each taxpayer will be obliged to register and submit reports annually to the tax authorities in Arabic or any other language, but with translation into Arabic. The standard rate of VAT in the UAE will be 5%, but there will be some exceptions that provide for a zero-rate tax or full exemption from it. The zero rate will be applicable in such areas as the export of goods and services outside the CCASG, international transportations, operations with certain types of precious metals, the primary sale of real estate (subject to its implementation within 3 years after completion of the construction), the supply of air, sea and land transport, as well as educational and medical services. The provision of certain types of financial services, as well as transactions with residential real estate, land and local passenger...

Switzerland has published a new version of the VAT Law which provides for a number of amendments. The changes are aimed at improving the mechanism for taxing of local companies with the value-added tax and they will come into force on January 1, 2018. To date, the foreign companies providing services in Switzerland are exempt from the VAT from Swiss turnover if it does not exceed 100,000 Swiss francs, that is equivalent to $ 103,726. In the opinion of the Federal Council, this has caused a decline in the competitiveness of the Swiss firms, especially in the border regions. According to the adopted amendments, on calculating the obligations of the company on VAT, its global turnover will be taken into account. The enterprises with world financial turnover of 100,000 Swiss francs or more will be subject to the VAT from their supply, starting with the first franc of the turnover amount in Switzerland. The introduction of a new system for mail-order companies has been postponed until January 1, 2019, because the Swiss post offices will need more time to implement the appropriate technical provisions. With the advent of this date, the mail-order companies will be subject to the value...