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The Canada Revenue Agency (CRA) has issued a series of favourable tax rulings in which it concluded that Canadian domestic anti-avoidance legislation would not apply to certain proposed transactions involving back-to-back cross-border loans. In particular, these rulings consider situations in which Canadian trusts and partnerships use such structures to obtain foreign financing, and in so doing, avail themselves of a withholding tax exemption that is ordinarily only available to Canadian corporations. The favourable outcome of these rulings is good news for both non-resident investors and Canadian non-corporate entities alike.

On September 30 2004 the Brazilian authorities issued Provisional Measure 219 (PM 219), which granted tax benefits on purchases of fixed assets. Effective as from October 1 2004, Brazilian legal entities are allowed to claim a credit for social contribution on net income (CSLL) purposes (to be offset against the CSLL liability), corresponding to 25% calculated over the book depreciation of assets acquired between October 1 2004 and December 31 2005.

The domestic production deduction is a significant element of the new US corporate tax legislation. It has transfer pricing implications which are not yet completely clear, explain Sean Foley, Anne Welsh and Thomas Herr of KPMG LLP (US)

The Greek government plans to introduce a wide-ranging corporate tax bill that will cut the rate of corporate tax from 35% to 25% by 2007 despite concerns over the country's fiscal deficit. From January 1 2005 there will be tax cuts from 35% to 32% in 2005, falling to 29% in 2006 and 25% in 2007.

The Advocate General has given an opinion in a case known as "D" that certian wealth tax relief in the Netherlands is contrary to EC law as it was only available to Dutch residents or under certain double tax treaty provisions. The taxpayer, D, a German resident, was denied from the relief as he was not a Dutch resident. The tax treaty between Germany and the Netherlands did not include an entitlement to the relief, whereas the Netherlands' treaty with Belgium did allow the relief to Belgian residents.

The European Commission has published a proposal to simplify value-added tax (VAT) compliance for cross-border traders throughout the EU.

Kristian Jensen, the Danish minister of taxation, has published draft legislation to tighten the country's transfer- pricing regime. The stringent proposals, intended to comply with the EU principle of freedom of establishment, would introduce documentation requirements for domestic as well as cross-border transactions.

From January 1 2005 large companies with operations in Brazil will have to meet monthly instead of quarterly deadlines for filing their federal tax and contributions return. Brazil's Federal Revenue Department, announced on December 2 2004 that companies with annual gross revenues more than BRL80 million ($29 million) will be affected by the changes.

Michael Durst: Wants a strong global network Michael Durst, formerly of the US law firm King & Spalding, has rejoined PricewaterhouseCoopers' transfer-pricing practice. In his new position, Durst is advising clients in tax dispute resolution, international tax planning and controversy defence.