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This e-newsletter gives you an overview of international corporate tax developments being reported globally by KPMG member firms in the Americas Region between 1 March and 31 March 2013.

Argentina Chile Panama USA
Brazil Costa Rica Peru Venezuela
Canada Dominican Republic Uruguay

For a full summary of global tax developments, visit kpmg.com/TaxNewsFlash.

To contact the Global International Corporate Tax Group email go-fmglobalict@kpmg.com.

  Tax area concerned Relevant date/case reference Description of measures and publication link
(Considerations in italic where necessary)
Argentina
Tax legislation adopted and regulatory update Personal property tax 2012 Argentina’s tax administration issued guidance establishing the valuations for personal property tax for the 2012 tax year.
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Foreign consumption tax 18 March 2013 Argentina’s tax administration published a resolution amending the rules for remitting foreign consumption tax. The resolution is effective on the date of its publication (i.e. 18 March 2013).
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Brazil
Tax legislation adopted and regulatory update Social security February 2013 Brazil’s Congress introduced a new Provisional Measure to reduce labor costs and create new jobs. Basically, the standard employer contribution of 20 percent on the payroll of employees is replaced by a fixed percentage that is levied on the gross revenue of the company. Companies, however, may elect to retrain the former rules for making the 20 percent employer contribution to social security. The Provisional Measure is effective as from its date of publication (February 2013) for 60 days, and may be extended for an additional 60-day period.
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Other Tax facts March 2013 Brazil’s tax system is viewed as being notoriously difficult, and according to a World Economic Forum report, tax regulations are a major challenge for entities doing business in the country, with tax rates and inefficient government bureaucracy also ranking among the top five issues. KPMG in Brazil published an interview with a KPMG tax professional in Brazil regarding the outcomes of the report.
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Canada
Tax legislation adopted and regulatory update Provincial sales tax 1 April 2013 Businesses need to be ready to face the new provincial sales tax in British Columbia, effective 1 April 2013.
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Pension plans March 2013 The Canada Revenue Agency released guidance on new pooled registered pension plans — a new option for tax-effective retirement savings for employees of small businesses and self-employed individuals who do not already have a company pension plan.
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Reporting requirement 30 September 2013 Canadian mining or oil and gas companies that are registered with the U.S. Securities and Exchange Commission will soon be required to report payments made to governments in all countries where the company operates. This new reporting requirement applies for companies’ fiscal years ending after 30 September 2013.
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Proposed legislation Business Tax 30 November 2012 Taxpayers who are providing services through a corporation by conducting a personal services business, need to be aware that they might lose the tax deferral advantage that this structure previously offered because of a pending tax rate increase on personal services business income. This change is already generally effective for tax years ending on 30 November 2012 and later.
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Federal Budget 2013 Finance Minister Jim Flaherty delivered the government’s 2013 federal budget. While the budget’s main focus is on jobs and the economy, the budget includes many targeted tax measures aimed at addressing what the government considers tax “loopholes” in the Canadian tax system. Areas as diverse as tax loss trading, life insurance products, labour sponsored venture capital corporations, trusts, thin capitalization rules, targeted GST provisions, the mining industry and farm losses are all affected.
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Federal Budget/
Customs
2013 Canada’s 2013 federal budget includes several changes to tariffs and other customs measures that may affect taxpayers who import goods into Canada. The changes relate to targeted tariff relief, simplifying bonded warehouses, and the general preferential tariff regime.
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Saskatchewan Budget 2013 Saskatchewan’s Finance Minister delivered the province’s 2013 budget which does not include any proposals for corporate or individual (personal) income tax rate changes.
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Alberta Budget 2013 Alberta’s Finance Minister delivered the province’s 2013 budget. The budget does not include any corporate or individual (personal) income tax rate changes or any other significant income tax measures.
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New Brunswick Budget 2013 New Brunswick’s Finance Minister delivered the province’s 2013 budget. The budget includes measures to increase both corporate and individual (personal) tax rates.
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Newfoundland and Labrador Budget 2013 The Newfoundland and Labrador Finance Minister delivered the province’s 2013 budget. The budget does not include any corporate or individual (personal) income tax rate changes or any other significant income tax measures.
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Administrative and case law Personal income tax Randy J. Ollenberger v. The Queen (2013 FCA 74) Canada’s Federal Court of Appeal (FCA) allowed a taxpayer's appeal to claim an allowable business investment loss (ABIL) of over $300,000 for an uncollectible loan on his 2007 income tax return. The FCA overturned the Tax Court of Canada's (TCC) decision that had denied the taxpayer the ABIL claim, finding that the TCC erred when it concluded that the start-up company was not carrying on an "active business.”
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Other Tax facts March 2013 KPMG in Canada prepared a tax guide providing brief overviews of the tax rates, individual (personal) and corporate income tax rules, indirect taxes, employee benefits, tax incentives, tax treaties, social security and other tax-related information.
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Chile
Proposed legislation Reporting requirement/
Stamp tax
March 2013 Chile’s Minister of Finance announced the introduction of a bill that would amend the rules for electronic payments and that proposes to reduce the rate of stamp taxes (duties).
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Costa Rica
Tax legislation adopted and regulatory update Reporting requirement June 2012 A June 2012 law established the basic rules for management of the solid industrial waste industry in Costa Rica, and a plan for management of solid waste proposes that local governments create their own municipal plan for the management of solid waste.
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Dominican Republic
Tax legislation adopted and regulatory update Corporate income tax 2012 Changes to the tax laws of the Dominican Republic were enacted late November 2012. Among the amendments are changes providing for a phase-out of an increased in the rate of corporate income tax.
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Panama
Treaties Information exchange agreement March 2013 Panama and Canada signed a tax information exchange agreement. The agreement will enter into force on the date of the later notice by which each country has notified the other that it has completed its domestic procedures for the agreement to enter into force.
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Peru
Tax legislation adopted and regulatory update Corporate income tax March 2013 Peru’s congress passed a law with changes to the income tax code concerning estimated tax payments made by corporations. The law establishes that eligible taxpayers may elect to forego certain estimated tax payments of corporate income if they satisfy certain criteria, such as sales and net income threshold amounts.
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Authorized economic operator 10 March 2013 Peru’s tax administration published the approved general procedures for authorized economic operator (Operador Económico Autorizado— OEA) certification. The procedure (effective 10 March 2013) establishes the general procedures for certification, renewal, suspension, and revocation of OEA status, as well as its benefits and requirements.
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Uruguay
Tax legislation adopted and regulatory update incentives February 2013 A decree provides tax relief for offshore hydrocarbon exploration in the territorial waters of Uruguay.
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Treaties DTT 25 January 2013 An income tax treaty between Uruguay and Finland entered into force 25 January 2013.
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Administrative and case law Real estate February 2013 Uruguay’s Supreme Court issued a decision, finding that the tax on rural real estate is unconstitutional. The Supreme Court based its decision on findings that the tax is unconstitutional under a question of federal taxation versus provincial taxation.
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USA
Tax legislation adopted and regulatory update - - For legislative changes and regulatory updates for the US please visit below link to the TaxNewsFlash United States.
Read TaxNewsFlash US

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Venezuela
Tax legislation adopted and regulatory update Personal income tax return 1 April 2013 Individual income tax returns for the tax year ending 31 December 2012 were due 1 April 2013.
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Corporate income tax March 2013 Legislation enacted in Venezuela provided a new method for calculating social benefits for corporate income tax purposes.
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