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Ayesha Lau

Elena Kostovska The FYR Macedonian government has approved the Law on Public Disclosure of Tax Debtors, thus permitting its entry into Parliamentary discussion. According to the law, the Public Revenue Office as well as the Customs Office will publish lists of debtors on their websites. The criteria for being included on such list is tax/customs debt older than 90 days or in excess of €2,000 ($2,700) for physical persons; €5,000 for legal entities. The debt will concern unpaid taxes (corporate income tax, personal income tax, VAT), customs duties, excise taxes as well as social security contributions.

Vladimir Kotenko

A monthly commentary on the notable facts, figures and goings-on in the tax world.

Bob van der Made EU leaders reached the following conclusions in respect of EU tax policy at their meeting on December 19 – 20 2013 in Brussels: Recalling its conclusions of May 2013, the European Council calls for further progress at the global and EU levels in the fight against tax fraud and evasion, aggressive tax planning, BEPS and money laundering. The European Council welcomes work undertaken in the OECD and other international fora to respond to the challenge of taxation and ensure fairness and effectiveness of tax systems, in particular the development of a global standard for automatic exchange of information, so as to ensure a level playing-field. Building on the momentum towards more transparency in tax matters, the European Council calls on the Council to reach unanimous political agreement on the Directive on administrative cooperation in early 2014. It calls for speeding up the negotiations with European third countries and asks the Commission to present a progress report to its March meeting. In the light of this, the revised Directive on the taxation of savings income will be adopted by March 2014. The European Council also takes note of the Council progress report to EU leaders on tax issues, welcomes the establishment by the Commission of an EU high level expert group on taxation of the digital economy, and invites the Commission to take into account the (parallel) work at the OECD, and report back to the Council as soon as possible. Progress should also be made quickly towards agreement on amending the EU Parent-Subsidiary Directive. The European Council calls for further progress on the disclosure of non-financial information by large groups. As to the Parent-Subsidiary Directive: outgoing EU Tax Commissioner Algirdas Semeta is eager to reach unanimous political agreement in the ECOFIN Council by May or June 2014. However, for this to happen it is understood that the Commission will need to drop its proposed introduction of a common general anti-avoidance rule, as there seems no unanimous support among member states for this. It is understood that the other main strand of the Commission's proposal to neutralise the distorting effects of mismatches resulting from differences in the tax treatment of hybrid loans between member states, should be successful and might be adopted by ECOFIN before the summer or in the second half of 2014. This largely depends on whether the European Parliament can issue its Opinion before the European elections.

Maria Damianou Effective from January 13 2014, the standard and reduced VAT rates in Cyprus increased from 18% to 19% and from 8% to 9% respectively. It was mandatory that all taxable persons subject to the aforementioned changes perform a physical inventory count to include both quantities and valuation upon the close of business on January 12. The final inventory report is to be maintained for a period of six years. In the case where a continuous electronic inventory system is used, a physical inventory count was not mandatory.

German Campos

Donka Pechilkova The Bulgarian Parliament adopted a new law, which concerns offshore companies and their activity in the territory of Bulgaria. The decrees of the new Act on Economic and Financial Relations of Companies Registered in Jurisdictions with Low Tax Regime and their Real Owner started to be applied effectively from January 1 2014. According to the law, the partnership, direct or indirect, of companies that have been registered in jurisdictions with a privileged tax regime is forbidden in 28 key sectors of the Bulgarian economy. It means that entities established in countries where income or corporate tax rates are 60% lower than respective rates in Bulgaria are not allowed to participate in tenders for public procurements; privatisation transactions; concessionary competitions; deals, concerning municipal or government property. There are restrictions for sharing of offshore companies in procedures for obtaining of general credit institution licenses, such as insurance licenses, as well as licenses for gambling activity, healthy-insurance funds, mobile services providers. Also, entities registered in jurisdictions with low tax regimes and whose real owner is unknown cannot participate or act as a publisher of periodical press. Another sector, which is closed for offshore companies, is the area of social agencies that are preparing and sharing public sociological analysis.

Khoonming Ho

Nancy Diep