Tom Borec

Interesting read on how US MNCs can be strategic on Pillar Two Compliance and potentially restructure their hold cos in response to P2. Careful consideration of local and P2 rules, economic business reasons, indirect transfer rules can help in optimizing tax positions and ensure compliance with ever evolving regulations and compliances. https://lnkd.in/gwUg88Bx #BEPS #P2 #Pillar 2 #OECD #International Tax #US Taxes

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Pillar Two Updates (2 September 2024) [2 of 2] Sweden - The Minister of Finance presented a draft bill on 18 Aug 2024 that would revise the provisions of the Pillar Two legislation primarily to incorporate the OECD administrative guidance, but also to address artificial arrangements under the simplification rule and potentially allowing the offset of foreign additional tax in cases involving controlled foreign companies.

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Reflecting on the future of the Grant Thornton network globally, I must express my optimism and the potential I feel. The Global Tax Conference of Grant Thornton in Milan brought together 150 participants from all continents and provided valuable insights into the future of taxation. Some of the highlights: Vikas Vasal, our Global Leader of Tax, discussed how global macro dynamics can influence taxation, highlighting: - Climate change, with countries responding through tax levies and incentives - Demographic shifts, with the developed world aging rapidly - Geo-political changes, forging new trade equations - Moderate inflation, leading to increased business costs - Technological advancements (AI and beyond), presenting both opportunities and challenges. Dave Munton emphasized the unique role of the International Business Center Directors as ambassadors of the network and explained how the International Business Support Function can meet our clients' global needs and enhance collaboration. Luca Vaiani and Emilio Carugati from Fideuram Asset Management SGR provided an Investor’s Overview, explaining market and investment trends. Giuseppe Perna from Enel Group highlighted the importance of tax transparency for international listed companies. Tax Strategy reports demonstrate how multinational companies address governance, social, and environmental responsibilities. Dan Dickinson presented on how ESG impacts taxation, predicting it to be a significant trend in global taxation. David Sites and Allen (Avi) Brandsdorfer spoke about the new legislation regarding Pillar II and the relevant safe harbour rules. My fellow IBCD Gabriele Labombarda and Murat Cihanger discussed Tax Digital Consulting. Trent Gazzaway described the importance of quality and risk management for our services. Karen Robb presided over the Indirect Tax breakout, where we connected with our EU VAT colleagues and indirect tax professionals from other continents, sharing valuable insights. #grantthornton #gobeyond #taxesg #taxtransparency #pillar2

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The Swiss tax authorities on July 9, 2024, released draft guidelines regarding the forthcoming platform rules for goods, which will take effect on January 1, 2025. The draft guidelines are currently open for consultation until August 23, 2024. The broad scope of these rules includes information requirements for all platforms. This report summarizes key details of the upcoming rules provided in the guidelines. #kpmg #switzerland #marketplace #VAT #2025

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#Swiss_GAAP_FER (#Swiss_GAAP_RPC) is becoming a thought-after accounting election choice with respect to the preparation of the #Pillar2 #QDMTT return of Swiss Constituent Entities. This is the case in particular for Swiss #MNEs but also for foreign #MNEs with substantial operations in the country. Our Assurance experts regularly publish technical guidance as well as thought leadership materials concerning the adoption of #Swiss_GAAP_FER in a blog that is available in the link below. Together with them, the PwC Tax team also provides technical support, experience and insights into the specific #Swiss_GAAP_FER election provided by art. 9, para 2 of the Swiss GloBE Ordinance. Do not hesitate to contact your usual PwC advisor to further discuss this topic and assess the potential impacts of such an election. #Swiss_GAAP_FER blog: https://lnkd.in/eP64XKJh #Pillar2_tracker: https://lnkd.in/eYpUxMV5 #Pillar2_data_input_catalog: https://lnkd.in/eUxHQkVy

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**"From Everyday Hustle to Strategic Alignment: Our Team Offsite"** 🌟 How do you perceive team offsites? Are they merely a nice bonus (like some German tax auditor might argue) or an essential investment in the future? 🚀 This is how I see it: They cost time and money (Invest), but they allow us to step away from the daily grind and focus on strategic matters (Return). At the recent STADA HQ Tax team offsite at Kloster Eberbach, we invested two full days to align with STADA's strategy and vision, enhancing our tax function to better meet business needs. 🎯 For me, it was very important to also consider the tax function in the broader context of the Finance Function and STADA overall, and I am very glad that Janina Hilsenberg from our Culture & People team inspired the team with a session on the idea of **Growth Mindset** which is part of the STADA culture, equipping us with strategies to embrace challenges and learn from them. 💡 As we wrapped up the event, we were united in our commitment to the action points identified and the need to sustain the momentum we've now created. 💪 Big Thank you to Jennifer Kosel for organisation as well as Jörg Michael & Stephanie Henseler and Janina Hilsenberg for your support in preparation and your guidance and comments. 👍 From my personal experience, I can now confidently say that team offsites are absolutely crucial and that Return > Investment. ✅ What are your thoughts on team offsites? Feel free to share your opinions in the comments. 💬 #oneSTADA #CultureDrivesPerformance #GrowthMindset

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The global minimum tax is one of the most consequential developments in international taxation. Check out BDO’s Pillar Two Implementation Tracker, which provides a high-level summary and updates on the adoption of the Pillar Two proposals around the world. Recent updates include Austria adopting all of the safe harbours, the Bahamas has indicated it will not be introducing a qualified domestic top-up tax until fiscal year 2025-2026. Kenya’s president has declined to sign the finance bill for 2024, which includes a provision for implementing a 15% minimum top-up tax in alignment with the OECD Pillar Two rules.

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Webinar: Simplifying Excise Tax Compliance Form 720 with E-Filing Solutions - Oct 2nd 2024 11am PST Join us, to Register click: https://shorturl.at/AHcwl as we explore how our vision aligns with the IRS’s goal of making tax compliance easier and more efficient. We’ll highlight our strong relationship with the IRS and how we’re helping to move their vision forward through seamless e-filing solutions. Discover which tax forms are available for e-filing, see a sample filing in action, and learn why e-filing is superior to paper-based filing as we close with a comparison of both methods. In this webinar, we’ll dive into how our innovative e-filing solutions align with the IRS’s mission to enhance tax compliance for individuals and businesses. Discover how our strong partnership with the IRS is driving efficiency in the tax filing process. Date: October 2nd 2024 Time: 11.00 AM to 12.00 AM (PST) Duration: 1 Hour hashtag hashtag #TaxFiling hashtag hashtag #EFiling hashtag hashtag #ExciseTax hashtag hashtag #Form720

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The OECD has imposed a deadline of 30 June 2024 on themselves for agreeing the Multilateral Convention for Pillar 1 (P1). There’s only a few days left, but consensus amongst tax professionals (https://lnkd.in/eB5kfRzW) is that it won’t happen as nothing happens in June anyway. The US already started the blame game last month (https://lnkd.in/eRzNVNGS), though last ditch efforts are still going on (https://lnkd.in/gT4numPi). The UN also treats P1 as failed, as it’s lining up to give tax on “the digital economy” another go (https://lnkd.in/edeZ6E2p). Also in other parts of the tax world, nothing happened in June. Pillar 2 (P2) activity slowed (https://lnkd.in/ehWxDnFs), even if new guidance last week made it come back a bit (https://lnkd.in/e3gUnkuw). Rumours that India (https://lnkd.in/e22jAysj) and Türkiye (https://lnkd.in/ec2AQRQc https://lnkd.in/en3Yg5zZ) are ready to adopt won’t dramatically alter the picture. Belgium’s EU Presidency ends this month without VAT in the Digital Age (ViDA) approved due to an Estonian veto (https://lnkd.in/gcAGz6bD), so Viva La Vida jokes will have to wait (https://lnkd.in/e6GE79ac). FASTER was of course approved, but that was last month. No one is talking about Unshell anymore. The global billionaire tax from Zucman (https://lnkd.in/e-auD-48) and Brazil (https://lnkd.in/epERerDt) failed to progress this month. A blueprint is due tomorrow, but US opposition (https://lnkd.in/edGcXYz5) means it mostly attracts shrugs. There’s an election in the UK, but you need to be eagle-eyed to spot differences on tax policy there (https://lnkd.in/ea3vxJyA). So all in all, June is a slow tax month in a slow tax year. Ulrich Schnaus described this as “Nothing Happens In June”. This playlist (https://lnkd.in/e-dRhhmF) also treats it as a Tape Loop (Morcheeba), that’s just the Same (Snow Patrol). Ray LaMontagne sings, “there’s really not that much to say, it’s just Another Day”. In other words, these are Quiet Times (Dido) or Strange Days (J.J. Cale) that feel like History Repeating (Propellerheads, Shirley Bassey). We’ll make it through Another Day (Buckshot Lefonque) and Do The Things We Normally Do (Dido) even if Rien N’a Changé (Les Poppys) and that leaves us Feelin’ The Same Way all over again. Fittingly, it’s not the first time I used that Norah Jones song to describe P1 (https://lnkd.in/eTrrqqzs), so you should Stop Me If You Think You’ve Heard This One Before (The Smiths), as it seems all I do is Talk Talk (Talk Talk), which just a bit Extra (Paula Perry, Léo Ferré), but to be expected if we are Stuck (Caro Emerald), going Round In Circles (Billy Preston) like a Spinning Wheel (Blood, Sweat & Tears). At this point, Gnarls Barkley sings “and I could go on and on and on, but Who Cares?” Only Queen still looks for a path out of this apathy, as Freddy Mercury proclaims “I Want To Break Free”. Obvious disclaimers: this is not advice. These views are my own and do not necessarily represent my employer.

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The future of international taxes - negotiations on Pillar One under the OECD BEPS 2.0. Project keep continuing. Does Amount A (new taxing right) depends on Amount B (TP simplification)? How did we get here? See the Statement by the Co-Chairs of the OECD/G20 Inclusive Framework on BEPS The Inclusive Framework on BEPS sets sights on Multilateral Convention signature by end of June as negotiations on a Pillar One package nears completion   30/05/2024 – The 16th meeting of the Inclusive Framework on Base Erosion and Profit Shifting (BEPS) took place in Paris from 28 May to 30 May 2024. More than 400 delegates representing 140 delegations (including 127 countries and jurisdictions and 13 observers) participated in the meetings.    During the three days of productive meetings, the Inclusive Framework discussed a range of topics including the implementation and impact of the BEPS minimum standards, the opportunities to further broaden the reach of this impact through technical assistance and capacity building, the status of and experience with implementation of the global minimum tax, plans for participation in a signing ceremony for the Subject to Tax Rule that will be held in Paris on 19 September 2024, and our ongoing tax policy work and delegate interest in role of tax in addressing inequality. We also engaged in a reflection on challenges and opportunities associated with the Inclusive Framework journey to date and opportunities for further enhancing effectiveness and inclusivity.   Finally, following productive discussions on remaining open issues related to Pillar One of the Two-Pillar Solution to address the tax challenges arising from the digitalisation of the economy, we can report that the Inclusive Framework on BEPS is nearing completion of the negotiations on a final package on Pillar One (which includes a text of the Multilateral Convention (MLC) for Amount A and a framework for Amount B) with the goal of reaching a final agreement in time to open the MLC for signature by the end of June. In this regard, we welcome the expressions of interest by France and Brazil in hosting a signing ceremony as soon as practical after the MLC is opened for signature. https://lnkd.in/g9dN4539 #OECD, #PillarOne, #AmountA, #AmountB

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Two interesting FAQs in the Circular 238/2024-GST (Sec. 128A) - Q.13 and Q.14. (I) Answer to Q.13 says tax liability required to be paid under Sec. 9 (5) is to be paid only by cash - there is not such restriction under the law to pay this liability only by cash, and even ITC can be used. Such beyond the law restriction was also prescribed in an earlier circular (167/2021). (II) Answer to Q.14 says Import IGST demands are covered by the Customs Act, 1962 and hence not covered by Sec. 128A. Think about it - (a) Import IGST is not an IGST levy but Customs levy, and therefore Mahindra & Mahindra applies even to Import IGST [link in comments] (b) Sec. 17 (5) (i) is not applicable to demands raised under Customs Act, even if they on account of fraud, suppression, etc.

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Interesting case with the higher German tax Court siding with the lower Court when ruling in favor of the taxpayer. The court case involved the stripping of the interest component from German treasury bonds and upstreaming of the profits produced ( capital gains derived from selling the interest component) in the form of tax free dividends to the German parent corporation. In brief, German corporation incorporated a Luxembourg SICAV, collective investment fund. The latter procurred the German treasury bonds divorcing their interest element by selling them to a third party realising a capital gain. The taxpayer employed the proceeds to paying out dividends to its German parent and asserted exclusion from taxation after fulfilling the participation exemption under the treaty. The Tax Administration displace the dividend by subsituting interest payment in their place. The Court in rejecting the recharacterisation, underlined inter alia that the bond was the asset acquired with the SICAV having the right to sell the intrinsic interest component with the proceeds being unrelated to the capital bond component and/ or the capital subscribed for buying the bonds, hence pointing that the distribution was rightfully labelled as dividend. The case remanded to the lower court with the request for determining if the arrangement creates a tax shelter and/ or abusive arrangement that may fall within the general anti abuse provisions. #courtcase #tax #abuse #treaty https://lnkd.in/dyDEic2J

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The article of Dominic Schmid and me was recently published in the professional tax magazine NWB 20/2024 p. 1385. The headline of this article is "A question of substance: "Substance Joint Audit" in the Unshell-Directive (draft)?" (Eine Frage von Substanz: „Substanz Joint Audit“ in der Unshell-Richtlinie?) In this article we are covering the possibility for tax authorities to initiate a substance joint audit as laid down in Art. 15 Unshell-Directive (draft). In this article, we are seeing the point that in the future not only the substance criteria as laid down in the Unshell-Directive (draft), but also the substance criteria mentioned in other provisions (CFC-motive test (Sec. 8 G-FTA); anti-treaty-shopping provision (Sec. 50d Para. 3 G-ITA) etc.) may or may not be subject to a "Substance Joint Audit". Thank you Dominic Schmid for the cooperation! #mazars #mazarsingermany #internationaltax #PIEtax #taxsubstance

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VATupdate.com Daily Newsletter: June 22 2024 Headlines June 22, 2024 -- BREAKING – No agreement on ViDA – Summary of the position of Estonia -- France releases specifications for e-invoicing reform -- Germany – Changes to VAT Declaration Guide for 2024 – Download Document -- India – GST Council Meet on June 22: What’s on the agenda? -- E-Invoicing & E-Reporting developments in the news in week 24 & 25/2024

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VATupdate.com Daily Newsletter: September 18, 2024 Headlines September 18, 2024 -- Bulgaria’s SAF-T Implementation: Phased Approach for Accounting Overhaul by 2025 -- Comments on ECJ C-248/23: Novo Nordisk AS VAT Treatment of Statutory Payments to State Health Insurer -- Estonia to Raise VAT to 24% for Security -- 2024 Olympics and Paralympics – VAT Recovery In France -- India Expands E-Invoicing Pilot to B2C Supplies and Reverse Charge Mechanism -- Peru Delays Implementation of 18% VAT on Digital Services to December 1, 2024 -- Thailand – Government Extends VAT Reduction to 7% until September 30

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https://lnkd.in/gqcFePw4 #csddd #sustainability #report Important corporate governance elements that would put Directors in control of the transition have been removed. Having the companies’ Directors involved in the process, for example through financial incentives to deliver on sustainability targets, would have been an essential means to ensure that they drive change within companies. This is already a practice in some businesses. Having it enshrined in law would have ensured a level playing field between European companies and equipped Directors to take effective action.

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Rate reconciliation disclosures: "Companies domiciled outside the US will need to separately disclose the state and local effects in their jurisdiction of domicile separately in their rate reconciliation upon adoption of the ASU." This applies in particular to Swiss entities that are subject to a federal income tax in addition to a cantonal/municipal income tax. It is a relatively common practice today for Swiss companies to start the rate reconciliation with a rate that blends the federal and the cantonal rates. Under the ASU, Swiss companies will be required to disaggregate the cantonal/municipal income tax rate effect from the federal income tax rate.

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https://lnkd.in/eJp-ZZbY On 4 September 2024, the Federal Council decided to bring the international supplementary tax under the income inclusion rule (IIR) into force with effect from 1 January 2025, thereby preventing base erosion and creating stable framework conditions. Why did the Federal Council bring the Swiss supplementary tax (QDMTT) into force in 2024, but is waiting until 2025 for the international supplementary tax (IIR)? Answer is in the FAQ

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