business taxation tagged posts

Foreign Firms to Get Chinese Tax Breaks

December 30, 2017 Taxation in China

China taxBEIJING – China hopes to attract more foreign investors into the country by using a series of tax breaks.

The government of China is offering up tax breaks for foreign companies in exchange for re-investing profits into their local operations.

Under the new rules, any foreign business which meets the pre-set criteria and re-invests in profits in China will be eligible to be exempt from paying provisional withholding income tax on the re-invested profits.

The prerequisites include keeping the investments in industries favored by the government, and ensuring that the re-investments flow directly to the target entity and not through some intermediary arrangement.

The government hopes that by encouraging the re-investment of profits into China many companies can be convinced to boost techno...

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Italy Halves Web Tax Proposal

December 20, 2017 Taxation in Italy

Italian web taxROME – Italy is persevering with its plan to impose a web tax, although the rate of the tax has been dropped.

On December 19th the lower house of Italy amended the country’s 2018 budget bill, lowering the rate of the proposed “web tax”.

Italy had previously proposed that a new tax is introduced on internet transactions, levied at a rate of 6 percent of the value of the transaction.

The rate has now been dropped to 3 percent.

The new tax will be levied on the sale of “intangible digital products” namely services such as online advertising and sponsored links.

The measures are expected to hit a number of internet giants, such as Google and Facebook, which see a significant portion of their incomes coming from advertising.

The tax will not apply to all sales, and will only be pai...

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Japan Eyes Tax Reward for Wage Hikes

December 4, 2017 Taxation in Japan

japanese-yen-notes-757cfTOKYO – Wage hikes and robots could soon help Japanese companies slash their tax obligations.

The government of Japan is evaluating potential new tax break which could see the business tax burden reduced by nearly a third.

Japan has spent the last several years taking steps to reduce the level of corporate income tax faced by businesses, which is expected to fall to as little as 29.74 percent in the business year starting April 2018.

However, the government is now looking at reducing the rate to as low as 20 percent.

The reduction will come in the form of deductions made available to businesses which actively invest in human resources, such as wage hikes and training programs.

Some deductions will also be available to businesses which invest in technologies to increase output and produ...

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Italy Steps Closer To “Web Tax”

November 28, 2017 Taxation in Italy

italy taxROME – Italy looks set to be a leader in the world by implementing one of the first digital sales taxes.

Over the weekend the Senate of Italy approved the implementation of a new tax on digital sales.

The tax is designed to expand the tax net to include multinational internet businesses which sell goods and services to Italians, but do not pay any local taxes by virtue of being registered in a different jurisdiction.

The new tax will require the online businesses to withhold a tax of 6 percent at the time of the sale, passing the revenues to the tax authorities.

The tax is expected to come into effect in January 2019, and will raise approximately EUR 114 million per year in extra tax revenues.

The exact mechanics of the tax have not yet been confirmed, but the government is expected to re...

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Thousands of Companies Skipping Taxes in Pakistan

November 20, 2017 Taxation in Pakistan

Pakistan taxesISLAMABAD – While Pakistan’s biggest companies are paying a significant portion of all taxes, thousands of small companies are skipping all of their obligations.

According to information in Pakistan’s recently published Tax Directory 2016, approximately 40 percent of companies in Pakistan did not pay any taxes despite filing tax returns.

In total, 79 700 tax returns were filed by companies and partnerships, with 31 364 companies, and the remainder being made up by partnerships.

The Tax Directory shows that of the businesses that did file returns, approximately 33 000 did not pay any taxes at all.

However, it is noted that the non-payment is an indicator of poor compliance, as the tax rules in Pakistan state that businesses that make a loss must still pay a tax of 1 percent, if they se...

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