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Donald Vella

David Cuellar

Emanuel Bancila In recent years Romanian taxpayers had to deal with significant delays in refund of the excess input VAT. As a result, the European Commission started the administrative preliminary phase of the infringement proceedings against Romania. Currently, the majority of Romanian tax inspection task force is assigned for tax audits and requests related with the refund of the excess VAT. In addition, a recent ruling of the European Court of Justice (ECJ) stated that the administrative measures taken by the tax authorities during a tax audit concerning a VAT refund cannot preclude a taxpayer from obtaining default interest on a late refund by the tax authorities. Therefore, it appears that now the time has come for the Romanian tax authorities to pay the bill for all those delays in refunding the excess input VAT – specifically by paying default interest to the amounts in question. The VAT Directive provides that in case the amount of deduction exceeds the amount of payable VAT, the member states may either make a refund or carry forward the excess to the following period. Romania opted for a refund of the excess input VAT. Moreover, the member states have the freedom to set out the conditions based on which the refund procedure is performed, however with the observance of the applicable VAT European principles.

Filip Babic According to the new bylaw on interest rates considered to be adhering to the arm's-length principle (published in the Official Gazette RS 17/2014), new interest rates have been prescribed with regards to related party financing transactions. These rates will be used to calculate interest income and interest expense arising from loans provided to or from related parties. The proposed rates are applicable to loans in RSD (Serbian dinar) and loans indexed in foreign currencies such as EUR, USD and CHF.

Jackie Hess

Daniel Armesto

Tax reform, the Supreme Court and the OECD’s BEPS project mean that tax risk management will only get more important for Mexican taxpayers, believes David Franco, of Maplecroft.

The growing complexity of worldwide transfer pricing rules continues to expand documentation requirements, transparency initiatives and audits, all of which create challenges for multinational companies, believe Nancy Manzano and Bernadette Pinamont of Vertex.

To say that the European financial transaction tax (FTT) has been controversial would be an understatement. From its inception in September 2011, the EU proposal has been met with vitriol from some in the financial sector, who argue that the tax will pilfer pensions and wreak havoc on the European economy, while others have championed it as the solution to the eurozone crisis, labelling it the ‘Robin Hood Tax’. It also has the added advantage of appeasing a politically disillusioned electorate by promising to land a decisive blow to bankers, who in the public’s view caused the mess in the first place. Aaran Fronda dissects this divisive tax.

See who has done the tax work on this month’s biggest deals.