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Daniel Harrison Laos is in the middle of a property boom, and it has caught the attention of the tax collectors and legislators. The result: a 5% income tax on the sale or transfer of land and/or buildings (real property) introduced in the Amended Tax Law No. 05/NA, dated December 20 2011 (amended tax law). This new obligation takes aim at individual taxpayers; taxpayers which have historically enjoyed tax-free gains on real property transactions. Notably, the legislation specifically includes transfers distinctly from sales to ensure transactions with no consideration are caught – perhaps an inclusion with transactions between relatives and the like in mind.

Rajendra Nayak

Bob van der Made On December 6 2012, the European Commission issued two formal recommendations, one on aggressive tax planning and one on measures intended to encourage third countries to apply minimum standards of good governance in tax matters. These non-binding recommendations form part of a broader action plan to strengthen the fight against tax fraud and evasion. According to the Commission, EU member states should introduce in their bilateral tax treaties a rule which states that no avoidance of double taxation shall be granted in respect of items of income which have not been subject to tax in the other contracting state. This should apply to unilateral measures for the avoidance of double taxation as well. In addition, the Commission wants member states to renegotiate, suspend or terminate bilateral tax treaties with non-EU countries which do not respect the principles of the EU Code of Conduct for business taxation. Until these non-EU countries respect these principles, they should be placed on national blacklists' the Commission states.

Elena Kostovska On October 31 2012, The FYR Macedonian Parliament ratified the income and capital tax treaty signed with Luxembourg on May 15 2012. The taxes covered by the treaty are the personal income tax, profit tax and property tax in FYR Macedonia while in Luxembourg taxes include individuals' income tax, corporation tax, capital tax and communal trade tax. The treaty is generally in line with the OECD Model Tax Convention on income and on capital with some deviations/specifics discussed below.

David Cuellar

May May Kyi

Rudina Hoxha Albania has been applying an attractive flat tax of 10% since 2008. The same flat tax, approximately, has been implemented in the last decade by most of the regional countries. Thus, the question naturally arises: Since most of the regional countries have adopted almost the same flat tax, what makes Albania attractive beyond its low tax norms?

Tom Seymour An exposure draft (ED) of proposed new transfer pricing rules was released on November 22 2012. The ED represents phase two of the reforms announced by the government in November 2011 intended to modernise Australia's transfer pricing laws. Phase one is complete with the recent enactment of the treaty equivalent transfer pricing rules in Subdivision 815-A which, controversially, have retrospective effect from 2004. The ED proposes new Subdivision 815-B (dealing with separate entities), 815-C (permanent establishments); 815-D (record keeping requirements) and 815-E (partnerships and trusts). If enacted, these provisions are proposed to replace Division 13 of the Income Tax Assessment Act and the recently enacted Subdivision 815-A will cease to operate.

Nélio B Weiss

Nancy Diep