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This is a newsletter designed to provide senior tax executives (VP of Tax and Tax Directors) monthly updates on the latest Tax issues within the Asia Pacific region.
Asia Specific Archive
Asia Specific, April 2006
The tax authority recently released an issues paper to counter "extreme salary sacrifice" used to reduce taxes on superannuation contributions.
Asia Specific, March 2006
The government recently reintroduced a bill in relation to proposed reforms to exempt most foreign-source income and capital gains derived by a "temporary resident" from tax.
Asia Specific, February 2006
The government recently introduced amendments to the Income Tax Assessment Act to simplify the eligibility criteria for claiming a tax exemption in respect of foreign service earnings. The amendments impact Australian tax residents required to work offshore for a temporary period.
Asia Specific, December 2005
The Authority for Advance Rulings recently ruled that the activities of an Indian liaison office do not create a "business connection" under the tax law; hence, a tax liability should not arise in India, provided it does not enter into negotiations with customers.
Asia Specific, November 2005
In a recent Australian tax case, a Singapore company argued that the use of its barges in Australian waters created a permanent establishment under the Australia-Singapore double tax treaty. The Full Federal Court held that the Singaporean company did have a permanent establishment in Australia, as the relevant article of the treaty recognises a permanent establishment in Australia if a Singapore resident holds "substantial equipment" used in Australia, and the barges represented this substantial equipment.
Asia Specific, October 2005
The Mumbai Tribunal recently held, in the case of Hindalco Industries Limited v. Assistant Commissioner of Income Tax, that payments made to a US company to acquire know-how, process technology and technical assistance are taxable as fees for included services (FIS) under the India-US tax treaty.
Asia Specific, September 2005
The Australian Taxation Office (ATO) recently released its 2005-06 Compliance Program. The program identifies the areas considered by the ATO to represent the greatest compliance risk. Whilst the area of greatest focus continues to be the large business sector, the 2005-06 Compliance Program places a new emphasis on auditing compliance within the Small to Meidium Enterprise (SME) sector.
Asia Specific, August 2005
The government recently proposed rules that will allow a broader range of foreign income received by Australian entities to flow through to foreign residents free of Australian income and withholding taxes (conduit foreign income). The relief is to apply to Australian companies and other corporate tax entities including limited partnerships and certain trusts.
Asia Specific, July 2005
Pakistan recently released its 2005 budget. The corporate tax rate applicable to public companies remains unchanged at 35%. The corporate tax rate applicable to private companies and banking companies continues to be reduced in accordance with the 2002 budget to 37% and 38% respectively (currently 39% and 41% respectively). A 1% tax rebate is to be granted to companies listed between 1 July 2005 and 30 June 2006.
Asia Specific, June 2005
Australia recently released its 2005 budget. Capital gains ("CGT") is no longer to apply to disposals by non-residents of the following Australia assets:
· shares in Australian companies that are not land-rich, and
· interest in Australian trusts that are not land-rich,
Asia Specific, May 2005
The Belgian tax authorities recently issued a circular concerning the tax treaty concluded between Hong Kong and Belgium. Particularly significant are the tax authorities' comments concerning the elimination of double tax in relation to dividends received by Belgian resident companies from Hong Kong resident companies. |