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Richard J Vann of Greenwoods & Freehills shows where the tax opportunities lurk under the latest US-Australia double tax agreement

UK government proposals to reform the corporate tax system could be damaging for domestic businesses. The government plans to introduce a costly domestic transfer pricing system and impose tax changes to finance leasing. Companies have until November 3 2003 to respond to the Corporation Tax Reform Consultation published on August 12 2003.

The Italian tax authorities (ITA) have revoked, with ruling 159/E of July 25 2003 (the New Ruling), their previous ruling dated December 13 2000 (the Previous Ruling). The Previous Ruling addressed a transaction (the Share Exchange) whereby an Italian company (the Contributing Company) transferred to a beneficiary company resident of a different EU Country (the Beneficiary Company), the controlling stock of another company (the Controlling Stock), solely in exchange for the Beneficiary Company's shares (the Shares).

The newly elected national government announced few weeks ago a reform package, now before Congress, intended mainly to combat tax evasion. Among other unveiled initiatives, the executive has made public its intention to reinforce the punitive legislation on tax crimes and submitted amendments to the income tax.

On July 9 2003 the Brazilian Congress approved a Bill, originally from 1989, relating to the application of the municipal services tax (ISS). The Bill brought important changes to the existing legislation and expanded the original list of services subject to the tax. The newly-added services are mainly relating to IT and banking services. The new project is expected to increase the total of ISS collected by municipalities from R$8 billion ($2.7 billion) to R$15 billion ($5 billion) within the next three years.

Urs Landolf was nominated head of PricewaterhouseCoopers' tax and legal practice on July 1 2003. Landolf is now a member of the firm's European management board. Andrin Waldburger will replace him as head of tax and legal in Switzerland.

The Italian government has published a draft of the proposed new law on corporate taxation, which it expects will come into force on January 1 2004. The wide-ranging tax reforms include reducing the corporate income tax rate from 36% to 33% and new participation exemptions.

Yell Group completed a listing on the London stock exchange with a $3.2 billion initial public offering in July 2003. Sarah Priestly, a tax partner at Weil, Gotshal and Manges in London, advised Yell Group. "The complicated deal was structured so that the US investors were not faced with tax problems," she said.

The Russian Ministry of Taxes and Levies published an order on the registration of foreign organizations with the tax authorities on July 28 2003. Changes to the way multinational companies are registered with tax authorities in Russia will take effect from October 1 2003.

The UK Customs & Excise unique amnesty scheme closes on September 30 2003. The scheme allows businesses trading above the VAT threshold but not registered for VAT to register without incurring a penalty for late notification.