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The EU VAT rules will apply to 10 new member states from May 1. Enterprises trading in all 25 countries of the new EU must prepare for this expansion. Ariane Beetschen of CMS Bureau Francis Lefebvre says enterprises must promptly harness their resources because of the importance of the task to be completed.

The Australian commissioner of taxation, Michael Carmody, recently penned a letter to the chairperson of all publicly listed companies, reinforcing the messages in the document that he released in June last year - the Australian Taxation Office's (ATO) Large business and tax compliance booklet.

Gordon Brown, UK Chancellor of the Exchequer, announced a new tax break for the film industry in his March 17 2004 Budget. The measure will replace the so-called section 48 incentives, which will expire on July 1 2005.

The European Commission announced on March 16 2004 an investigation of the tax incentives offered by the Italian government to newly-listed companies. Upon meeting certain conditions, companies that list their shares on a regulated EU stock exchange qualify as of January 1 2004 to a reduced 20 % corporate income tax rate.

Belgium and Hong Kong's double taxation agreement offers a number of chances for tax planning. And, under certain conditions, withholding tax on dividends will not be levied, explain Kurt De Haen, Kris Vanderstappen and Guy Ellis of PricewaterhouseCoopers

The Japanese parliament has approved the tax treaty signed with the US on November 6 2003. The treaty would eliminate source-country withholding taxes on all royalty income, dividends paid to parent companies owning a majority stake in the paying entity, and some interest income. Japan and the US are expected to exchange instruments of ratification on March 30 2004 in Tokyo, at which point the treaty will enter into force.

On February 27 2004 the minister of finance released Revised Draft Legislation and Explanatory Notes (the new proposals) that contains significant changes to Canada's foreign affiliate regime. The new proposals revise draft legislation that was originally released on December 20 2002 (the 2002 proposals), and introduce a number of new measures (most not dealing with foreign affiliates), including measures to tax payments for non-compete covenants and measures to allow public corporations to return capital without generating a deemed dividend.

Integration of newly acquired foreign businesses poses as many tax challenges as the acquisition itself, cautions William Chip of Deloitte & Touche