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  • In its pre-Budget memorandum, the Confederation of Indian Industry has urged the minister for finance to abolish the fringe benefits tax or allow companies to pay an extra 1% in corporate tax to achieve the government's objective of widening the corporate tax net. The body favours one corporate tax rate rather than additional charges, such as the one for education. The Budget for 2006-2007 is due to be unveiled at the end of February
  • The insertion of the economic substance doctrine into the US Internal Revenue Code will affect bona fide business transactions which are not connected to tax shelters, according to the Tax Section of the American Bar Association. The measure was contained in the Tax Relief Act of 2005, which was passed by the Senate in November.
  • Sixth VAT Directive – Article 20(3) – Capital goods – Deduction of input tax – Adjustments of deductions – Immovable property – Disposal by means of two connected transactions, one exempt, the other taxable – Apportionment.
  • Tax law – Corporation tax – Tax exemption for charitable foundations established under private law – Residence requirement.
  • Sixth VAT Directive – Article 13A(1)(c) – Exempt activities – Provision of care in the exercise of the paramedical professions recognised by the member state concerned – Services provided by a physiotherapist which do not fall within the definition of that profession – Services provided by a psychotherapist who is recognised as such only under the national legislation governing that profession but not under the VAT provisions.
  • UK tax consultancy, Chiltern, has appointed John O'Donnell to the position of Director, Indirect Tax Investigations. The role will see him conducting investigation work undertaken by HMRC in respect of VAT, excise and customs duties, both in civil and criminal matters. He will also advise on the Proceeds of the Crime Act, specifically focusing on confiscation issues.
  • The Indian government has extended the withholding tax exemption until March 31 2006, after Indian airlines made a representation stating that this would make leasing of aircraft from foreign companies more economical. The Extension will reduce the cost of leasing aircraft and engines from foreign lessors by up to 40%.
  • From November 7, HM revenue & Customs began phasing out the payment of working tax credits by employers. New claimants will receive the credits directly into their bank accounts and existing claimants will be transferred to this system by April 2006.
  • The Greek Ministry of Finance has drafted a law introducing a cost plus method to determine gross profits of Greek companies which are solely involved with providing services to their head offices or to associated foreign companies. All costs taken into account for the determination of gross profits will be considered to be tax deductible as long as the companies have obtained a special license from the Ministry of Finance.
  • US taxpayers will be able to request an automatic, six-month tax-filing extension for certain business returns from the 1 January 2006. Businesses will be able to request a six-month tax-filing extension, without a reason or signature. This simplifies the existing two-step process, although a tax-filing extension does not alter the tax-payment deadline.