Search results for

As previously mentioned in this column in April 2004, the Irish Finance Bill 2004 contained a number of measures aimed at increasing the attractiveness of Ireland as a corporate headquarters and holding company (HoldCo) jurisdiction. Broadly these new measures provided for an exemption from corporation tax on gains arising on the disposal of qualifying shares, and a wider double tax relief for foreign taxes levied on dividends received by an Irish resident company.

Dividends are generally exempt from income tax in the hands of the recipient shareholder in South Africa and there is no withholding tax on dividends. The tax authorities, however, tax dividends in another way, in the form of secondary tax on companies (STC). Subject to a number of exceptions and exemptions, STC is payable by a South African-resident company declaring dividends at the rate of 12.5% of the gross dividend declared. Secondary tax on companies is a direct tax on the company declaring the dividends, although indirectly borne by the shareholders, as they naturally get lower dividends after the STC.

Hendrik Blankenstein, formerly international tax counsel for Nestlé, a Swiss food company, started in the Zurich office of Transfer Pricing Associates on November 1 2004. Blankenstein was responsible at Nestlé for issues such as the tax aspects of global acquisitions and supply chain restructuring, for businesses in the Americas and Europe.

Koen van't Hek, who left Ernst & Young for the international law firm Baker & McKenzie in July 2004, has rejoined the big-four firm. The u-turn comes after the departure of 10 other Ernst & Young tax partners to Baker & McKenzie, many of them transfer-pricing specialists. Koen van't Hek specializes in international tax.

The Internal Revenue Service (IRS) has issued Notice 2004-68 adding several European business entities to the list of per se corporations.

The new UK tax disclosure rules, which oblige promoters and in some cases users of tax planning arrangements involving financial products or related to employment to notify details of the arrangements to the Inland Revenue, came into effect on September 30 2004. The notification must include an explanation of each element of the arrangements, its expected tax effect and its legal basis.

The tax authorities have sent the Congress a tax bill including proposed legislation concerning additional interest deductibility restriction to be effected through a series of thin capitalization rules that would enter into force on January 1 2005.

In the midst of campaigning for re-election, President Bush signed the American Jobs Creation Act on October 22 2004 to end the five-year trade row with the EU over the foreign sales corporation (FSC) and extra-territorial income (ETI) schemes.

On September 19 2004, the ruler of Dubai enacted the laws of the Dubai International Financial Centre (DIFC), a recent addition to the several free-trade zones already existing in the UAE. The DIFC aims to benefit the region as a whole by acting as a catalyst for the region's economic development in the same way that similar centres in the US and Hong Kong have contributed to their respective regional development.

At the heart of discussions within the EU about excessive transfer-pricing documentation requirements being imposed on European multinational enterprises (MNEs), in recent times there has been an increase within the member states of reporting obligations set forth for regulatory purposes, which also include information among related parties.