The Bloomberg BNA International Tax Blog is a forum for practitioners and Bloomberg BNA editors to share ideas, raise issues, and network with colleagues. The ideas presented here are those of individuals, and Bloomberg BNA bears no responsibility for the appropriateness or accuracy of the communications between group members.
September 19, 2013
Transfer Pricing Report's Dolores Gregory rounds up the latest U.S. Tax Court developments in this story, published in today's issue of Transfer Pricing Report . In transfer pricing cases...
September 5, 2013
Former U.S. Treasury Associate International Tax Counsel David Ernick spoke with Bloomberg BNA Transfer Pricing Report's Kevin Bell last month about the OECD's white paper on documentation. Below is...
July 25, 2013
BBNA subscribers can now stay connected to the Bloomberg BNA Tax and Accounting Center, any time and from anywhere with our new Tax Center App! This free app provides comprehensive,...
July 12, 2013
With the Organization for Economic Cooperation and Development to present its plan on base erosion and profit shifting one week from today, a review of what's at stake seems in order. Below is a...
July 5, 2013
“The Internship” isn’t exactly a movie that you’d expect to get into complex issues of international tax. But the dopey, crude comedy – in which Owen Wilson and Vince Vaughn play two...
June 27, 2013
Robert Cole, who worked in the field of transfer pricing for many years, died last month at age 81. In addition to improving the field he worked in, Bob also sought to improve Transfer Pricing...
May 2, 2013
The District of Columbia Office of Tax and Revenue scored a significant victory April 23 in a long-running battle to defend its use of a controversial method of transfer pricing. [ BP Products...
April 18, 2013
In today’s issue of Transfer Pricing Report, practitioners from Mayer Brown LLP make a case for seeking a financial services advance pricing agreement, pointing to increased uncertainty under...
April 4, 2013
During Bloomberg BNA and Baker & McKenzie's transfer pricing conference in Paris last month, tax executives spoke about the growing problem of reputational risk and the tendency of the general...
March 21, 2013
Those who work in the transfer pricing area are used to thinking in terms of technical analysis: applying one of the five OECD-sanctioned pricing methods, calculating a range of results from...
February 7, 2013
U.S. double tax negotiations with India are at an impasse, according to IRS Deputy Commissioner (International) Michael Danilack. At the Pacific Rim Tax Institute in Palo Alto, Danilack—the U.S....
January 24, 2013
Today’s issue of Transfer Pricing Report had the following items on advance pricing agreements: 1. U.S. statistics from the Advance Pricing and Mutual Agreement Program director showing that in...
January 17, 2013
Frequently in transfer pricing, taxpayers must look to case law to answer questions not adequately addressed by either the OECD guidelines or the relevant country’s regulations. In the area of...
January 16, 2013
As noted recently by members of an American Bar Association committee, the pricing of related-party guarantee fees is an area of “tremendous uncertainty.” The adoption of the U.S. services...
January 10, 2013
Developments over the past year have done much to awaken public concern about the loss of tax revenue from companies' transfer pricing practices, with hearings in the U.S. Senate and in U.K....
December 13, 2012
In the lead section of today's Transfer Pricing Report, business practitioners and members of the Organization for Economic Cooperation and Development's Working Party No. 6 tackle the question of...
December 7, 2012
The OECD’s discussion draft on intangibles has generated more than 1,000 pages of comments from practitioners and business groups, and the debate over many of the positions taken in the draft...
November 30, 2012
In the Nov. 29 issue of Bloomberg BNA’s Transfer Pricing Report, Michael Danilack, the U.S. Competent Authority, confirmed that he is cautious about endorsing advance pricing agreements with...
October 3, 2012
“Taxmaggeden,” new reporting requirements under “Obamacare,” and competing tax reform initiatives are just some of the uncertainties that await corporate tax professionals after the November...
September 6, 2012
Safe harbors have become a big part of the transfer pricing debate over the past year. This is not surprising given the ever-greater need for certainty and the growing discomfort—from some sectors...
August 9, 2012
As reported in today’s issue of Transfer Pricing Report, two recent U.S. Tax Court petitions filed by Altera Corp. almost certainly represent the IRS’s chosen litigating vehicle for the issue of...
July 26, 2012
Almost exactly a year ago, the IRS announced that its Advance Pricing Agreement program would leave the Office of Associate Chief Counsel (International) and merge with the competent authority...
May 4, 2012
The June 6 panel on transfer pricing developments, rather than focusing solely on the BRICS countries (Brazil, Russia, India, China, and South Africa) will consider emerging economies overall.
April 27, 2012
Today, the world’s taxing authorities are looking for more revenue from increasingly limited sources. Many developing nations, eager for their fair share of the tax pie, are enacting transfer pricing rules. But what form should those rules take?
April 19, 2012
Today’s issue of Transfer Pricing Report is a milestone for the publication: we’ve now been reporting on these issues for 20 years! So how have things changed?
April 10, 2012
Multinational companies operating in the BRIC countries face some daunting challenges. In Brazil, government-imposed profit margins cause frequent double taxation. In Russia, OECD-style transfer pricing rules were adopted only last July.
April 3, 2012
The Internal Revenue Service’s annual statutory report on advance pricing agreements for 2011, released April 2, shows a drop in both completed APAs and new cases filed, with completions down to 43 from 69 from 2010 and applications down to 96 from an all-time high of 144 the previous year.
March 23, 2012
With little in the way of formal guidance from the IRS or the OECD on the issue, expert panelists at the June 6-7 Bloomberg BNA/Baker & McKenzie transfer pricing conference will consider intercompany pricing of management fees, guarantees, and intragroup financing. The discussion will focus on the stringent conditions that multinational companies face in many jurisdictions to deduct certain intercompany service charges and the best practices for minimizing the possibility of double taxation.
March 15, 2012
Multinational companies attempting to plan for the future face the unprecedented challenges of a continuing global economic crisis and a constantly changing tax law environment. The pressure for added tax revenues and the perception that the present U.S. system needs reform make long-term planning difficult.
March 12, 2012
In his article, “Challenging the Status Quo: The Case for Combined Reporting,” Michael McIntyre, a professor at Wayne State University Law School, makes the case for combined reporting with formulary apportionment.
February 1, 2012
Pascal Saint-Amans, who takes office today as head of the Organization for Economic Cooperation and Development's Center for Tax Policy and Administration (CTPA), spoke with Bloomberg BNA correspondent Rick Mitchell about his outlook on the current global tax scene and his plans for the CTPA.
June 20, 2011
2011-06-20 On June 9, 2011, the IRS announced that the duplicate filing requirement for Form 5472 will no longer be required. In T.D. 9529, 76 Fed. Reg. 33997 (6/10/11), the IRS explained that duplicate reporting in the Form 5472 context is no longer necessary due to technological advances in electronic p
June 17, 2011
At the kick-off to the BNA-Baker & McKenzie transfer pricing conference June 8, keynote speaker Sam Maruca — the IRS's newly appointed director of transfer pricing operations — indicated the Service may be turning its back on the much-criticized September 2007 coordinated issue paper on cost sharing buy-ins.
June 10, 2011
On May 11, a bipartisan group of six Congressmen introduced H.R. 1834, the Freedom to Invest Act of 2011. The bill, whose lead sponsors are Ways and Means Committee member Kevin Brady (R TX) and Jim Matheson (D UT), would
May 18, 2011
Recent consideration of a repatriation holiday in order to encourage domestic investment and job creation has largely centered on differentiation from the 2004 holiday, which, with the benefit of hindsight, yielded mostly stock buybacks and dividends. The proposal put forth by Rep. Kevin Brady (R-Texas), which has
As reported in today's Daily Tax Report, IRS Deputy Commissioner (International) Michael Danilack on February 25 discussed the implications of the recent reorganization that created the Large Business & International Division in the IRS.
On February 8 the IRS unveiled its second voluntary disclosure program for U.S. taxpayers with undisclosed foreign financial accounts. The program bears many similarities to the first disclosure program that ended on October 15, 2009, which resulted in approximately 15,000 taxpayers disclosing their offshore
Even as interest in a U.S. territorial system of taxation finds new life amid murmurs of comprehensive tax reform the IRS is occupied with issuing guidance central to a hallmark of the infamous worldwide system of taxation that the United States currently employs, i.e. the foreign tax credit. In December 2010
Despite increased efforts to crack down on international tax cheats, the IRS remains lacking in the use of some of the basic tools at its disposal. As reported by BNA in the January 26 Daily Tax Report , Swedish broadcaster SVT recently determined that the Swedish national tax agency ( Skatteverket ) has failed
With the holiday season in full swing and a gush of last-minute Congressional activity, one would not be remiss for having overlooked the adoption of T.D. 9508 (75 Fed. Reg.76262 (12/8/10)). However, the temporary/proposed rules represent welcome news for foreign holders of U.S. Treasuries. More specifically
There is good news on two fronts for taxpayers considering (or already seeking) an advance pricing agreement between the United States in Canada. First, arbitration will apply broadly to the agreements, and second, more involvement by the U.S. Competent Authority in cases should help relieve the current backlog in
As editor of BNA's Transfer Pricing Report, I have mixed feelings whenever transfer pricing news makes it into more mainstream media outlets, as has been happening more and more lately. (For recent examples, see a succint and fairly accurate summary of the Veritas Software case by
After lying low for some time, interest in a U.S. territorial tax system is reviving. On November 10, Erskine Bowles and Alan Simpson, the co-chairmen of the President's deficit reduction commission, released their draft proposal for cutting the deficit and remaking the income tax. Their plan assumes that tackling
Ireland's low corporate tax rate is under sharp scrutiny as speculation abounds that the EU is informally pressing for a rate hike to cut the country's budget deficit and massive debt, brought on by the 2008 global recession, subsequent bank bailouts, and years of excessive borrowing. EU Economic Affairs Commissi
How do governments fairly assess taxes on a multinational company's cross-border transactions involving highly valuable intangibles for which no third-party comparables exist? U.S. and Canadian government officials will provide their views on this topic in the context of recent changes to the Organization for
With U.S. and Canadian officials' recent comments that procedures for arbitration of double tax disputes are nearly finished, a big question is how those procedures, due out Dec. 15, will cover advance pricing agreements. When he announced that the guidelines were close to done in late September, IRS Deputy
With increased governmental audit resources, new regulations, and better access to information by fiscal authorities worldwide, the incidence of transfer pricing controversy is expected to increase substantially in coming years. Despite a growing array of dispute resolution alternatives, it is likely that the
Microsoft, the U.S. software developer, generates large amounts of cash from the sale of its products. In its fiscal year ending June 30, 2010, it generated more than $24 billion in free cash flow. On the same date, it sat on almost $37 billion in cash and short-term investments.
In today's issue of BNA Tax Management's Transfer Pricing Report, François Vincent, national leader of KPMG Canada's global transfer pricing services, discusses the result in the Tax Court of Canada's decision in the General Electric Capital case.
Although most nations lack the necessary regulatory authority, they are nonetheless stretching the arm's-length concept under their transfer pricing regulations to impute related-party exit charges when multinational enterprises restructure operations to shift assets, risks, and functions to lower tax jurisdiction
Where to put the Advance Pricing Agreement Program at the IRS has been an issue since the program was created over 20 years ago. In fact, the tug of war over the program between Chief Counsel and what was then the office of the Assistant Commissioner (International) was what led to the creation of the Deputy
As nations claw their way out of the global economic crisis, revenue-seeking governments have an increasing interest in erasing national borders--at least when it comes to shedding some light on the activities of large multinational corporations--through more robust exchange of information.
International enforcement. The Internal Revenue Service announcement August 4 indicates it is taking the matter seriously--reorganizing its forces to add 875 to the 600 already considered part of its International program. It also is renaming the Large and Midsize Business (LMSB) division the Large Business
With August recess and the campaign season looming, Senate Democrats and Republicans are hurriedly attempting to negotiate final amendments to advance the Small Business Jobs Act (H.R. 5297; S. Amdt. 4519). For international tax professionals, the bill likely will not raise an eyebrow but for one provision
Practitioners in 27 countries examined the use of comparable data in their jurisdictions and revealed several global trends, some of them—for example, the growing use of the transactional net margin method—reflecting a divergence between common practice and stated policy. The survey, by BNA International's
Transfer pricing doesn't rise to the attention of Congress all that often--at least, not so much that there have been any hearings on it since 2002, when then-Acting Assistant Treasury Secretary for Tax Policy Pamela Olson testified before the House Ways and Means Committee on plans to rewrite the cost sharing
The OECD is about to tackle a law professor's dream assignment--updating how the organization's 1995 transfer pricing tax guidelines treat intangibles.
While Senate Finance Committee Chairman Sen. Max. Baucus (D- Montana) announced June 30 that his committee is opening an investigation on the tax practices of Transocean Ltd., the Switzerland-based offshore drilling contractor embroiled in the Gulf of Mexico oil spill, it seems that the Internal Revenue Service
From BNA Tax Management Transfer Pricing Report 's Molly Moses: Canada's June 3 policy release on acquiring information from taxpayers was a good excuse to explore the state of disclosure law in that country, especially given recent U.S. developments like the Supreme Court's refusal to consider Textron's case
Trying to determine when restructuring of a multinational gives rise to compensation for the loss of functions? A new Special Report by BNA Tax Management Transfer Pricing Report examines contractual provisions in third-party automotive and industrial supply agreements to illustrate when the restructuring of a
IRS Chief Counsel William Wilkins answered a host of questions about the agency's proposed disclosure schedule for uncertain tax positions during a BNA webinar June 9, where he and international tax experts from the private sector engaged in a broad-ranging discussion of the many unanswered questions surroundin
The United States and Switzerland signed a protocol March 31 allowing for the provisional application of their Aug. 19 agreement requiring Swiss bank UBS to hand over details on 4,450 secret bank accounts held by U.S. taxpayers.
On February 26, Treasury's Financial Crimes Enforcement Network (FinCEN) published in the Federal Register proposed regulations that would clarify who is required annually to file the FBAR. For those not in the know, "FBAR" is shorthand for Treasury Form TD F 90-22.1 , Report of Foreign Bank and Financial Accounts
India's 2010 finance bill, released Feb. 26, seeks to raise additional revenue by broadening the number of technical services transactions by nonresidents subject to tax in India , and proposes the changes retroactive to 1976. In the new budget, the explanation to Section 9 of the Income Tax Act would be
February 5, 2010
The Obama administration's fiscal year 2011 budget unveiled Feb. 1 contained a broad-ranging package of international tax provisions estimated to raise $122 billion over 10 years, including provisions to prevent shifting of high-value intangibles income out of the United States.
BNA Tax & Accounting Transfer Pricing Report has released two Special Reports on the tax treatment of business restructurings--one on Germany and one on China.
January 29, 2010
Internal Revenue Commissioner Douglas Shulman Jan. 26 unveiled a proposal to require large business taxpayers to report their uncertain tax positions and the associated dollar amounts when filing their annual tax returns. Shulman called the proposal “a major step toward
January 27, 2010
The Swiss government is facing a legal and political dilemma in how to respond to a Jan. 22 ruling by a Swiss federal court backing an appeal against the hand over of details on secret bank accounts to U.S. tax
January 15, 2010
Tax authorities in 2010 will continue their heightened scrutiny of intercompany transactions and after successes with cooperating through the Joint International Tax Shelter Information Centre, governments are expected to exchange information about companies transfer pricing and begin simultaneous audits. Other trends
December 7, 2009
On December 3, Michael DiFronzo, Deputy Associate Chief Counsel (International) at IRS, spoke at a Practicing Law Institute conference in Los Angeles. While addressing forthcoming projects on Subpart F, DiFronzo noted that the Service has received many requests from practitioners and taxpayers
The Organization for Economic Cooperation and Development's draft revision of transfer pricing guildelines is hailed by one of the arm's length standard's fiercest critics as a step toward formulary apportionment. University of Michigan law school professor Reuven Avi Yonah argues that once
November 16, 2009
Mundaca Hearing Emphasizes International Enforcement On November 4, Michael F. Mundaca appeared before the U.S. Senate Finance Committee for the hearing on his nomination as Treasury Assistant Secretary for Tax Policy. Mundaca has a strong background in international tax policy,
November 10, 2009
KPMG practitioners Hareesh Dhawale and David Crosswy examine the potential impact of transitioning to international financial reporting standards on a company's intercompany pricing policies and on the methods used to test whether policies comply with the international arm's length standard.
November 9, 2009
Elvin Hedgpeth, who was with the U.S. Competent Authority office for more than 28 years before joining Ernst & Young, and Arjo van Eijsden, head of the firm's Dutch tax litigation group, describe how tax officials' recent pronouncements indicate that they likely will participate in
October 27, 2009
The U.S. continues to increase its focus on high-wealth individuals operating accounts abroad. At the American Institute of Certified Public Accountants fall meeting here in Washington this week, several IRS officials, including the IRS Commissioner himself, spent time discussing the new IRS focus on high-wealth in
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The Internship--and Google's Sales Personnel