India’s Ministry of Finance recently amended service tax rules related to online information and database access or retrieval (OIDAR) services.
The government said it is imposing a 15% tax on downloads and purchases of digital goods from offshore retailers.
Here are some key changes, effective from December 1, 2016: (more…)
President-elect Donald Trump’s election win moves Apple, Pfizer, Microsoft and other big U.S. corporations much closer than they have been in years to winning a big tax break on approximately $2.6 trillion in foreign profits.
This article explains the mechanics of taxing foreign-source income, the 2004 repatriation holiday, proposals for another holiday, and the prospects of enacting a repatriation holiday under the Republican-controlled government.
U.S. corporations are taxed on a worldwide basis, meaning that they’re generally taxed on income that’s earned within and outside of the U.S. subject to certain exceptions; income earned outside the U.S. isn’t subject to U.S. tax until it’s brought back to the United States — in other words, until it’s repatriated. At that point, it’s included in the corporation’s gross income. To mitigate double taxation, U.S. corporations may elect to either deduct or claim a foreign tax credit for the foreign income taxes that were paid or accrued on the foreign earnings.
Most developed countries, on the other hand, have adopted a territorial tax system. Such countries generally only tax income derived from sources within their borders. (more…)
The IRS said it plans to modify the regs relating to certain triangular reorganizations involving foreign corporations.
Specifically, in Notice 2016-73, the tax agency announced it will alter the rules affecting the treatment of property used to acquire parent stock or securities in triangular reorganizations involving one or more foreign corporations, as well as describe the consequences to persons that receive parent stock or securities in those reorganizations. (more…)