| South Africa | CFC rules: On 13 January 2020, President signed Taxation Laws Amendment Act 2019, which amends section 9D of the Income Tax Act, 1962 regarding the definition of controlled foreign company rules and extends the application of CFC rules for both direct and indirect transactions. See the story in Regfollower |
| Ireland | Incentives on industry/manufacturing: On 22 December 2019, President signed the 2019 Finance bill into law. In accordance with the Act, the 25% R&D credit be increased to 30% to provide enhanced supports to small and micro companies. See the story in Regfollower |
| Croatia | Main corporate tax rates: On December 11, 2019, the Government officially published Law. Under the Act, taxpayers who have earned income of up to HRK 7.5 million are subject to corporate tax rate of 12% and it applies as from 1 January 2020 for the 2019 income tax return. See the story in Regfollower |
| Nigeria | Main corporate tax rates: On 13 January 2020, the President signed the 2019 Finance bill into law. Under the Act, a lower 20% corporate income tax rate applies for medium size businesses with revenues between NGN25 million and NGN100 million. Also, the standard 30% rate which will now only be applicable for large companies with revenues above ₦100 million. However, businesses with a turnover below NGN25-million are exempted from CIT rate. Thin capitalization rules: The Finance Act 2019 introduces thin-capitalization rules of an interest deduction received from non-resident associated parties, with any additional interest expense allowed to be carried forward up to five years. Taxability of dividend income: In accordance with the Finance Act 2019, dividend distributed from petroleum profits are subject to withholding tax of 10%. Accordingly, additional dividend other than profits are exempted from tax and franked investment income only to un-taxed distributions. Technical service fees for non-resident: According to the Finance Act 2019, technical service fees received by a non-resident company from a Nigerian company are subject to a 10% withholding tax on the gross amount deducted at source. See the story in Regfollower |
| France | Main corporate tax rates: On 29 December 2019, Government published 2020 Finance Bill in the Official Gazette. Under the Act, the standard corporate tax rate is 28% on the first EUR 500,000 and 31% on the excess for the year 1 January to 31 December 2020. And, as of 1 January 2021 to 31 December 2021, the rate will be 27.5%; for fiscal years starting on or after 1 January 2022, the standard rate of corporate income tax will be 25% for all companies and all taxable income. Reduced rate: On 29 December 2019, Government officially published 2020 Finance Act. The Act reduces corporate income tax rates to 28% in 2020 for small and medium enterprises, 26.5% in 2021 and 25% in 2022. See the story in Regfollower |
| Ukraine | CFC rules: On 16 January 2020, the Parliament adopted a Law, which amends the Tax Code. The Law proposed to introduce a new term into current legislation of Controlled Foreign Company (CFC). This change is to be effective as from 1 January 2021. Taxation of capital gains: On 16 January 2020, the Parliament adopted a Law, which amends the Tax Code. Under the Law, a resident company will be subject to 15% withholding tax for capital gains on foreign sales of shares or corporate rights, if not provided in double tax treaty with other country. Thin capitalization rules: The Parliament approved a Law on 16 January 2020. The Law was introduced a new thin capitalization rule, which would apply to transactions with related and unrelated persons if the debt is greater than 3.5 times the company’s equity and this rules will no longer apply to lease companies and financial institutions. Withholding rates on dividends: The draft Law, which was adopted by the Parliament, stated that certain payments to nonresidents would be treated as dividend-equivalent payments and is subject to a withholding tax of 15% rate. See the story in Regfollower |
| Argentina | Withholding taxes due: On 14 January 2020, the Government issued a General Resolution, which establishes procedures and provides deadlines for withholding tax payments on dividends paid by a permanent establishment to its parent company. With effect as from 14 January 2020, the Resolution states that the filing of the additional 13% withholding tax rate on dividends paid by a permanent establishment to its parent company is temporarily reduced to 7% during 1 January 2020 to 1 January 2021. See the story in Regfollower |
| Norway | GAAR: Norway introduced a new general anti-avoidance rule with effect as from 1 January 2020, which will apply to direct taxes. Accordingly, if the GAAR can be applied, the transaction shall be taxed as if the transactions had been completed in a manner that reflects the financial substance. See the story in Regfollower |
| Costa Rica | Incentives on small business: The Ministry of Finance recently published a draft resolution on tax benefits for small and medium enterprises, whose gross income does not exceed CRC 106 million and a tax reduction during the first three years of operation or commercial activities. See the story in Regfollower |
| Colombia | Submission of return: On 23 December 2019, the tax authority published a Decree specifying the deadlines of tax return filing for 2020. According to the Decree, for large taxpayers, the tax return deadline is between 14 April and 27 April 2020. For other taxpayers, the tax return deadline is between 14 April and 12 May 2020. On the other hand, the return submission deadline for large foreign assets taxpayers is from April 14 to April 27, 2020 and for other taxpayers is from April 14 to May 12, 2020. Due dates main corporate income tax: On 23 December 2019, the tax authority published a Decree specifying the deadlines of tax payment for 2020. Under the Decree, for large taxpayers, the 1st tax payment deadline is between 11 February and 24 February 2020, 2nd tax payment deadline is between 14 April and 27 April 2020, and the 3rd tax payment deadline is between 9 June and 24 June 2020. For other taxpayers, initial tax payment deadline is between 14 April and 12 May 2020, and the 2nd payment deadline is between 9 June and 24 June 2020. See the story in Regfollower Main corporate tax rates: On 27 December 2019, Colombia has enacted tax reform Law 2020, which replaces the previous tax reform law 2019. The Act reduces corporate tax rate to 32% for 2020. Also, the rate will be reduced to 31% for 2021 and as from 2022, the rate will be 30%. On the other hand, the corporate tax rate in respect of financial institutions is reduced to 36% including 4% surtax for the fiscal year 2020. Also, the rate will be reduced to 34% including 3% surtax for the fiscal year 2021 and 33% including 3% surtax for the fiscal year 2022. Withholding rates on dividends: The tax reform for 2020 increases the dividend withholding tax rate to 10% from 7.5% and applies to foreign non-residents companies. Sanctions for tax evasion: On 27 December 2019, Colombia has enacted tax reform Law 2020, which replaces the previous tax reform law 2019. Under the Act, the criminal law provisions related to tax matters was amended. Also, the Act reduces the penalties for late filing of the return of overseas assets. See the story in Regfollower |
| Italy | Withholding taxes due: On 15 January 2020, the tax administration approved the updated withholding tax return form for fiscal year 2019. The Form must be submitted electronically by 31 October 2020. See the story in Regfollower |
| Bangladesh | Incentives on industry/manufacturing: On 9 January 2020, the National Board of Revenue published a Statutory Regulatory Order offering tax benefits to the power companies up to 15 years, except for coal-based ones. The income tax holiday and other tax benefits were applicable only for those power companies which came into commercial operation by December 31, 2019. Accordingly, the private power generation companies, which will come into operation by December 31, 2022, will be exempted from payment of income tax on their incomes derived from power plants up to December 31, 2034, on payable interest against foreign loans, on royalties, technical know-how and technical assistance fee and capital gain to be derived from transfer of shares. Also, foreign employees of those companies will also be entitled for tax exemption up to three years from the date of their arrival in Bangladesh. See the story in Regfollower |
Pakistan | Taxability of other income: On 28 December 2019, the Federal Board of Revenue officially published the Tax Laws Ordinance 2019, which amends the Income Tax Ordinance 2001. The Act introduces a 10% final withholding tax on gains derived by non-residents from the disposal of debt instruments and government securities invested in through a Special Convertible Rupee Account maintained with a bank in Pakistan, as well as other simplifying measures for such investments. See the story in Regfollower |
| Austria | Main corporate tax rates: The Government released its Program for 2020-2024 regarding several tax reform measures. The Program proposed to increase the threshold of corporate income tax from EUR 30,000 to EUR 100,000 and reduce the corporate income tax rate from 25% to 21%. Incentives on small business: The program planned to abolish the minimum corporate rate for providing relief to small and medium enterprises. See the story in Regfollower |
| Greece | Main corporate tax rates: On 12 December 2019, the President announced that a Law was officially published. According to Act, as from 1 January 2020, corporate tax rate will be reduced from 28% to 24% for all legal entities for the fiscal year 2019 and thereafter. Withholding rates on dividends: On 12 December 2019, the President announced that a Law was officially published. Under the Act, dividend withholding tax rate will be reduced from 10% to 5% as from 1 January 2020. Participation exemption for capital gains: On 12 December 2019, the President announced that a Law was officially published. In accordance with the Act, as from 1 July 2020, capital gains derived by a Greek resident corporation from the separation of qualified participation will be exempted from corporate tax rate. See the story in Regfollower |
| South Korea | Taxability of royalty income: On 31 December 2019, the National Assembly has enacted tax reform bill for 2019, which clarifies that royalty payments for patents rights registered outside of Korea that are used in local manufacturing activities in Korea will be considered to be Korean source royalty income. If Korean entity pays damages to any patent holder for the infringement of a patent registered outside of Korea, the payment will be subject to the Korean statutory withholding tax rate of 16.5%, including the 10% surtax. See the story in Regfollower |
| Peru | Taxation of capital gains: On 30 December 2019, Government issued Supreme Decree, which modifies the capital gains tax exemption rules. The Decree entered into force on 1 January 2020. See the story in Regfollower |
| Bulgaria | Treatment of losses: The Parliament recently approved tax loss carry forward rules for controlled foreign companies. It was stated that the losses may be carried forward for up to five years and should be applied to tax losses incurred after December 31, 2018. See the story in Regfollower |
World Tax Brief: February 2020
February 16, 2020
Share This
