Tax News Daily
The latest tax news from around the world, summarised and tagged for tax professionals. Updated twice daily.
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Healthcare VAT: New Tax Rates and Exemption Rules
New VAT rates and exemption rules for the healthcare sector have been introduced, affecting how medical services, products, and related supplies are taxed. The changes may redefine which healthcare services qualify for VAT exemption and which are subject to reduced or standard rates, with significant implications for hospitals, clinics, pharmaceutical companies, and medical device suppliers. Businesses and healthcare providers must review their VAT recovery positions and pricing structures in light of the updated rules to ensure compliance and optimise their tax positions.
UNIRE Prizes Not Always VAT-Taxable: Registration Is the Decisive Factor
An Italian tax ruling or court decision has clarified that prizes awarded by UNIRE (Italy's horse racing regulatory body) are not automatically subject to VAT. The decisive factor is whether the prize recipient is registered as a VAT taxable person engaged in an economic activity. Unregistered individuals receiving prizes do so outside the scope of VAT, while registered operators may be subject to it. This ruling provides important guidance for the horse racing and sports sectors in Italy regarding the VAT treatment of prize money and related income.
Spain Publishes Draft Law on VAT Rules for the Digital Age
Spain has published a draft law implementing VAT rules aligned with the EU's VAT in the Digital Age (ViDA) initiative. The legislation addresses modernization of VAT compliance obligations, likely covering platform economy rules, single VAT registration, and digital reporting requirements. This marks a significant regulatory update for businesses operating in Spain, requiring them to adapt their VAT systems and processes to meet new digital-era standards. The draft law reflects Spain's transposition of EU directives aimed at reducing VAT fraud and simplifying cross-border VAT obligations across member states.
Vietnam’s Decree 144: Key VAT Changes Effective June 2026
Vietnam's Decree 144 introduces key VAT changes effective June 2026, updating the country's VAT framework. The decree likely revises VAT rates, expands or narrows exemption categories, and clarifies rules on taxable supplies, potentially impacting sectors such as agriculture, technology, and services. Businesses operating in Vietnam must review their VAT compliance processes to align with the new requirements. The changes reflect Vietnam's ongoing efforts to modernize its tax system and broaden the VAT base in line with economic development priorities.
Khanna Lays Into Gavin Newsom’s Tax Proposal, Setting Up 2028 Battle Lines
Representative Ro Khanna has publicly criticized California Governor Gavin Newsom's tax proposal, creating a significant intra-Democratic rift that observers are framing as early positioning for the 2028 presidential race. Khanna's opposition centers on the fiscal and economic implications of Newsom's proposed tax measures, which have drawn scrutiny over their potential impact on businesses and individuals in California. The public disagreement highlights broader tensions within the Democratic Party over tax-and-spend policy approaches, with both figures appearing to stake out distinct economic platforms ahead of a potential future White House contest.
FBR suspends nine Faceless Customs officials in major crackdown
Pakistan's Federal Board of Revenue (FBR) has suspended nine officials from its Faceless Customs Assessment system in a significant disciplinary crackdown. The Faceless Customs initiative was introduced to reduce human interaction and curb corruption in import duty assessments. The suspensions suggest irregularities or misconduct within the system, raising questions about the integrity of customs valuations and duty collection. The action signals FBR's intent to enforce accountability within its reformed customs framework.
Georgia Tax Preparer Obtained $30,000 from Fraudulent Claims, Feds Say
A Georgia-based tax return preparer has been charged by federal authorities with fraudulently obtaining approximately $30,000 through false tax claims. The case involves the submission of fabricated or inflated deductions and credits on client returns, allegedly without the knowledge or consent of taxpayers. Federal investigators identified discrepancies that triggered the fraud inquiry. The case underscores ongoing IRS and Department of Justice efforts to prosecute unscrupulous tax preparers who exploit their position of trust to generate fraudulent refunds. Convictions in such cases typically carry penalties including fines, restitution, and imprisonment under federal tax fraud statutes.
KP enforces new annual taxes on multiple businesses
Khyber Pakhtunkhwa (KP) province in Pakistan has enforced new annual taxes targeting multiple business categories. The measure reflects the provincial government's efforts to broaden its tax base and increase internally generated revenue. The new levies apply across various sectors, signaling a push toward greater fiscal autonomy at the provincial level. This development is significant for businesses operating in KP as they face additional compliance obligations under the updated tax framework. The enforcement represents a concrete step in provincial tax administration reform in Pakistan.
The Pros and Cons of Common Exit Options for Construction Owners: ESOPs, PE, Third-Party Sales
This article examines exit strategies for construction business owners, including Employee Stock Ownership Plans (ESOPs), private equity, and third-party sales. ESOPs offer notable tax advantages: sellers to ESOPs can defer or eliminate capital gains taxes under Section 1042 of the IRC, and S-corporation ESOPs may pay no federal income tax on the ESOP-owned portion of profits. These tax benefits make ESOPs particularly attractive compared to other exit options. The article weighs these tax incentives against liquidity, control, and valuation considerations, helping construction owners evaluate which exit path best suits their financial and succession planning goals.
ITAT Restores Unsecured Loan Addition for Fresh Verification by Assessing Officer
India's Income Tax Appellate Tribunal (ITAT) has restored an unsecured loan addition case for fresh verification by the Assessing Officer. The tribunal remanded the matter back to the AO level, requiring a new examination of the unsecured loan transactions that had been added to the taxpayer's income. This decision reflects the ITAT's approach of ensuring proper factual verification rather than adjudicating on incomplete records, allowing the AO to conduct a thorough investigation into the legitimacy and source of the unsecured loans in question.
FBR issues new cargo transportation framework for trade with Iran
Pakistan's Federal Board of Revenue (FBR) has issued a new cargo transportation framework governing trade with Iran. The regulatory update sets out rules for the movement of goods between the two countries, with implications for customs procedures, documentation requirements, and compliance obligations for traders and transporters. The framework is intended to bring greater order and oversight to cross-border trade flows, addressing concerns around informal commerce and ensuring proper customs clearance. Businesses engaged in Pakistan-Iran trade will need to align their operations with the updated FBR guidelines.
Pakistanis back 5pc tax on social media influencers, survey finds
A survey conducted in Pakistan finds that a majority of citizens support imposing a 5% tax on income earned by social media influencers. The findings reflect growing public sentiment that digital content creators generating significant revenues should be brought into the formal tax net. The proposal aligns with broader efforts by Pakistani authorities to tax the digital economy and ensure influencers comply with income tax obligations. The survey highlights public appetite for expanding personal income tax coverage to emerging digital professions amid Pakistan's ongoing fiscal consolidation drive.
ITAT Restores Demonetisation Cash Deposit Case for Fresh Rule 46A Examination
India's ITAT has restored a demonetisation-era cash deposit case for fresh examination under Rule 46A of the Income Tax Rules. The case involves cash deposits made during India's 2016 demonetisation period, with the tribunal directing reconsideration of additional evidence under Rule 46A, which governs the admission of evidence not previously presented before lower tax authorities. The decision requires a fresh review of supporting documentation to determine whether the cash deposits during demonetisation were adequately explained by the taxpayer.
Received Dividend, Loan, or Buyback Proceeds? Decode Deemed Dividend Under Section 2(22) with Practical Examples
This article provides a practical guide to India's deemed dividend provisions under Section 2(22) of the Income Tax Act, covering scenarios involving dividends, loans, and buyback proceeds. It explains how certain payments from closely held companies to shareholders can be treated as deemed dividends, attracting income tax liability. Using practical examples, the article decodes when loans advanced to shareholders, payments on behalf of shareholders, or distributions trigger deemed dividend treatment, helping taxpayers understand their tax obligations and potential exposure under this complex provision.
Coca-Cola Meets Sympathetic Judges in $20 Billion IRS Case
Coca-Cola's long-running $20 billion tax dispute with the IRS received a potentially favorable reception from appellate judges, signaling possible relief for the beverage giant. The case centers on transfer pricing methodology used by Coca-Cola to allocate income from its foreign licensees. The IRS challenged the company's pricing arrangements, resulting in a massive tax deficiency assessment. The appellate court's apparent sympathy toward Coca-Cola's arguments could have significant implications for how multinational corporations structure intercompany royalty and licensing arrangements and how the IRS applies transfer pricing rules.
First Time Buyer ISA consultation
The UK government has launched a consultation on a First Time Buyer ISA, a savings product designed to help individuals purchase their first home. ISAs (Individual Savings Accounts) are tax-advantaged vehicles in the UK where returns and withdrawals are exempt from income tax and capital gains tax. This consultation likely addresses the tax relief structure, eligibility criteria, contribution limits, and government bonus arrangements associated with the new product, making it directly relevant to personal income tax policy and savings incentives for UK taxpayers.
The Role of Contractual Arrangements in Transfer Pricing: Insights from Case Law and Practice
This article examines how contractual arrangements function within transfer pricing frameworks, drawing on case law and practical insights. It explores the weight tax authorities and courts give to written contracts versus actual conduct in related-party transactions, highlighting that contracts alone may not determine the transfer pricing outcome if economic substance differs. The piece analyzes key judicial decisions that have shaped how contractual terms are scrutinized, and offers guidance on aligning contractual arrangements with functional analysis and the arm's length principle to reduce dispute risk and withstand audit challenges.
ITAT: Reassessment Beyond Four Years Quashed as AO Reopened Case on Mere Change of Opinion Without Fresh Material
India's ITAT has quashed a reassessment proceeding initiated beyond the four-year limitation period, ruling that the Assessing Officer reopened the case based solely on a change of opinion without any fresh tangible material. The tribunal reaffirmed the established legal principle that reassessment under Section 147 of the Income Tax Act requires new information or material to justify reopening, and that a mere change of opinion by the AO on previously available facts does not constitute valid grounds for reassessment, protecting taxpayers from arbitrary re-examination of settled assessments.
ITAT Upholds Section 80P Deduction for Co-operative Credit Society, Deletes Section 68 Addition on Cash Deposits
India's ITAT has upheld the Section 80P deduction claimed by a co-operative credit society and simultaneously deleted an addition made under Section 68 concerning cash deposits. The tribunal affirmed that co-operative credit societies engaged in providing credit facilities to members are entitled to the Section 80P deduction, which exempts income of co-operative societies from tax. Additionally, the ITAT found the Section 68 addition relating to unexplained cash deposits unjustified, providing relief to the co-operative society on both the deduction claim and the income addition.
Telangana HC Allows GST Appeal Against Unsigned Section 73 Assessment Order
The Telangana High Court has allowed a GST appeal challenging an assessment order issued under Section 73 of the GST Act that lacked a proper signature. The case highlights procedural requirements for valid tax assessments, with the court examining whether an unsigned order holds legal validity. This ruling has significant implications for taxpayers facing similar procedurally defective assessment orders, potentially providing grounds to challenge such orders on technical grounds. The decision underscores the importance of tax authorities adhering strictly to procedural formalities when issuing assessment orders under India's GST framework.
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