| China | Incentives for Small enterprises – China’s State Council decided on August 19 to improve and extend the tax breaks available for small and micro enterprises. Small and low-profit enterprises are subject to enterprise income tax on 50% of their taxable income at a reduced rate of 20%, provided that the annual taxable income does not exceed CNY 200,000 in the period from 1 January 2015 to 31 December 2017. The State Council decided to increase the threshold of CNY 200,000 to CNY 300,000 (including CNY 300,000) in the period from 1 October 2015 to 31 December 2017. See the Story in Regfollower |
| Thailand | Incentives for R&D sector- The cabinet of Thailand has passed a tax incentive for the expenditures occurred in the R&D sector of technology and innovation. The tax incentive has become effective as from 1 January 2015 to 31 December 2019. Exemption of corporate income tax(R&D expenses as % of revenue or sales): For total revenue of 0 – 50,000,000: up to 60%; 50,000,001 – 200,000,000: up to 9% ; 200,000,000 and over: up to 6% See the Story in Regfollower |
| Canada | Corporate tax rate – Bill C-59 has received its first reading in 7th May 2015 that implements certain measures announced in the 2015 federal budget. But it will not be applicable until after the upcoming federal election expected in October 2015. The enacted corporate tax measures are given below – The small business income tax rate reduces from 11% to 9% from 2016 to 2019. |
| Peru | Incentives on Industry/manufacturing – A decree was published in the official gazette on 12 July 2015 with respect to the tax incentives being made available for taxpayers that invest in research projects or that are involved in scientific, technological development and innovation. If approved, a research project may be entitled to a tax incentive of 175% or 150%, depending on certain factors about the research project such as whether the taxpayer is the party conducting the research and the location where the research is being conducted. |
| Korea | Incentives – A person owns, directly or indirectly, more than 5% of the shares of a foreign corporation or performs substantial influence over such foreign corporation where the foreign corporation makes an investment in Korea with the investment amount corresponding to the shares owned by the Korean person. Where a Korean person owns, directly or indirectly, more than 5% (currently 10%) of the shares of a foreign invested company or exercises substantial influence over such foreign invested company, the amount lent to a foreign investor by the Korean person. See the Story in Regfollower |
| Brazil: | Interest on Net Equity- Brazilian Senator presented a report on the analysis of Provisional Measure 675 (MP 675) regarding new social contribution on net profits (CSLL) rate and elimination of interest on net equity on 12 August 2015.
MP 675- Tax rate (CSLL) increased from 15% to 20% for financial institution and this rate will be valid from September 2015. Interest- According to the new proposal, Interest on Net Equity (INE) will be gradually reduced 50% in 2016 and 25% in 2017 also that it will be completely eliminated in 2018. |
| Belgium: | Corporate tax Rate – A new tax on banks and insurance companies was approved by the parliament, and will be effective as from assessment year 2016. • For credit institutions: The deductions are reduced by the amount of the “debts to clients” multiplied by 2.37% (for AY 2016), and then multiplied by the notional interest deduction rate of the company. • For insurance companies: The deductions are reduced by the amount of the “technical provisions” multiplied by 1.88% (for AY 2016), and then multiplied by the notional interest deduction rate of the company. |
| New Zealand | Incentives on Industry/manufacturing -Added funding of R&D growth grants available for innovative businesses and -Exclusion of the NZD 1,000 incentive to join Kiwi Saver. See the Story in Regfollower |
| United Kingdom | GAAR – On 22 July 2015 the UK government issued a consultation document containing detailed proposals for strengthening the penalties for tax avoidance.The consultation document suggests that a penalty would be introduced in connection with the general anti-abuse rule (GAAR). This would be imposed when the taxpayer has committed a failure, which would be an occasion when the taxpayer sends in a return or claim, including a tax advantage from tax arrangements that fall within the scope of the GAAR. The penalty would apply after scrutiny by the GAAR Advisory Panel when HMRC has successfully challenged the abusive tax arrangements. See the Story in Regfollower |
| Pakistan | Corporate tax rate – Pakistan’s Budget for the fiscal year 2015/16 (tax year 2016) was presented on 5 June 2015. Under the budget proposal the corporate income tax rate is to be reduced to 32% from 33%. The Budget proposals will largely take effect from 1 July 2015 upon their enactment. See the Story in Regfollower |
World Tax Brief: August 2015
03 September, 2015
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