Rapid globalisation and an increasing reliance on technology, have called into question the suitability of the traditional definition of permanent establishment (PE). Tax professionals involved in digital business feel change is necessary but others think the rules should remain as they are.
Attendees at the Public Accounts Committee (PAC) conference last week expressed concern about HM Revenue & Customs’ (HMRC) plans to decrease staff numbers against its aim to curb tax evasion.
The Israeli Tax Authority (ITA) recently issued a pre-ruling which shows how tech companies can qualify for preferred enterprise tax breaks. The preferred enterprise regime is a step forward in the fight against base erosion and profit shifting (BEPS), encouraging tech companies to stay local.
The Alternative Information and Development Centre (AIDC) has released a report alleging that mining company Lonmin manipulated its transfer pricing for wage evasion purposes.
Defining intangibles is vital to the success of the OECD’s BEPS project because a clear definition is important for comparability and valuation. However, given the broad range of intangibles, deciding on one precise definition will be extremely challenging.
