Category: APJT Archive

In the sections that follow, we describe the most significant taxes in Uzbekistan. There are a number of other less significant or specific taxes, such as excise taxes and a number of taxes on “subsurface users” (i.e. oil, gas, and mining companies). It is important to perform a thorough review of any proposed business activity in order to determine the actual taxes that apply to it....

近年國際間反避稅、反洗錢、反資助恐怖主義及反貪腐呼聲高漲，各稅區政府愈加重視資訊交換，採行如金融機構共同申報準則(Common Reporting Standard, CRS)、移轉訂價三層文檔等規定。台灣地區已通過對法人的反避稅措施—受控外國公司(Controlled Foreign Company, CFC) 與實際管理處所(Place of Effective Management, PEM) 法令及個人CFC 條文作為配套。此外，免稅天堂經濟2019 年起陸續立法引進經濟實質新規(Economic Substance Act)，於當地所設公司須對九大類相關活動建立與之匹配的實質活動或人員安排。前述國際稅務環境轉變新增台商企業的運營挑戰，也成為趨使其資金回台的動力。...

In the past decade, China has astonished the world with its speedy transformation into an innovation superpower. It is of interest to understand the strategies that have been implemented by the Chinese Government to achieve the great advancements that have been made in terms of innovative development in China. The objective of this paper is to examine the impact of tax-related incentives on the innovation performance of Chinese firms. Based on data from 9,531 firm-year observations of 2,359 firms between 2009 and 2013, we find that tax-related incentives have positive impacts on a firm’s spending on R&D, but negative impacts on a firm’s patenting performance. The finding may provide policy implications and insights for national leaders and enterprises with agendas that entail moving up the technology ladder....

For over a decade, the Hong Kong SAR Government had been modifying the specific tax exemption regimes for investment funds (especially privately offered funds) with a view to attracting more funds and fund managers to establish themselves in Hong Kong. The journey began in 2006 when the first offshore fund exemption regime (section 20AC of the Inland Revenue Ordinance (“IRO”)) was introduced; this regime basically provides Hong Kong profits tax exemption for privately offered nonresident hedge funds retrospectively from the year of assessment 1996/97. Amendments were made in 2015 (section 20ACA was added) to expand the scope of exemption to cover privately offered private equity (“PE”) / venture capital (“VC”) funds provided certain conditions are met....

As a general rule, the well-informed Hong Kong tax practitioner tends to anticipate developments in Inland Revenue Department (IRD) departmental interpretation and practice notes (DIPNs) with a sense of dread and stoic resignation. In our well-worn cynicism, we assume there will be something wrong with the positions of laws pronounced on behalf of the Commissioner, ex cathedra; the question is only just how wrong the guidance will be and what sort of impact it will have on our clients. The August 2019 revision of DIPN No.28 on the deductibility of foreign taxes under section 16(1) of the Inland Revenue Ordinance (IRO), however, presented the long-suffering tax practitioner with a piece of technical analysis so patently wrong and illinformed that it can only, as I have written in the past in regard to the carry-forward of losses pursuant to an amalgamation, have been impelled by practical concerns, rather than technical purism. At least, one would very much hope that to be...

Under Hong Kong’s territorial tax system, only interest income that is derived from Hong Kong (or deemed as such) can generally be within the scope of Hong Kong Profits Tax. Hong Kong companies that lend overseas are in some cases not subject to Hong Kong Profits Tax on interest receipts. Under new proposals made by the Organisation for Economic Co-operation and Development (“OECD”), Hong Kong’s approach to taxing interest could come under increasing pressure. The denial of foreign interest deduction or the blocking of treaty access for interest withholding tax relief are among the potential implications of these new proposals. Multinational groups should be considering now what to do if such rules were to be enacted, including contingency plans looking at bringing such payments within the Hong Kong tax net and a consideration of the Hong Kong Corporate Treasury Centre (“CTC”) regime for qualifying entities. With indications that the Hong Kong Government is planning to enhance the CTC regime, if...

The tax treatment of carried interest (often referred to simply as “carry”) has been a contentious issue in Hong Kong for a number of years and one which has never been comprehensively addressed by the Inland Revenue Department (IRD). In this article, we examine the practices which have emerged in relation to the issue in Hong Kong, consider the extent to which those practices can be reconciled to the law, and explore ways in which the issue could be dealt with in order to better align with the law and provide an equitable outcome with high levels of certainty....

This article will review the cases reported in the second and third supplements of Volume 33 of Board of Review Cases, which were published in April and July 2019, respectively. There are four profits tax cases, five salaries tax cases, one property tax case, one appeal out of time case, and one case on penalty and costs of a hearing. Regarding the four profits tax cases, two are on property disposal, one is on a source issue, and one looks at whether the lending of money constitutes business. The salaries tax cases cover the issues of deduction of professional subscription fees, deduction of home loan interest, source of employment, chargeability of termination payment, and finalization of tax liability....

The Hong Kong economy grew solidly in the first three quarters of 2018, with a 3.7% real GDP growth in the first three quarters of 2018 over a year earlier. Taking into account the various increasing downside risks in the external environment, the HKSAR Government forecasts that the real GDP for 2018 as a whole will grow at 3.2%, which is within the range forecast of 3% to 4% announced by it in August 2018. Looking ahead, the various external factors, such as the China-US trade dispute, the rise of global trade protectionism, the possible further interest rate hikes in the US and the future development on Brexit, will likely affect Hong Kong’s economy and give rise to heightened uncertainties. Given the above external market situation and to achieve a long-term sustainable economic growth in Hong Kong, the Institute fully agrees to the HKSAR Government’s policy objectives of driving economic diversification and taking up the roles as a “facilitator” and...

With its strategic geographic location between China and Africa and its stable regulatory environment, Mauritius looks set to strengthen its position as an investment gateway to Africa under China’s “Belt and Road” initiative. This article discusses the tax factors that contribute to the success of Mauritius as a preferred investment jurisdiction and highlights some of the structuring possibilities available to Chinese entities looking to invest in Africa. These tax factors include a simple tax system, fast expanding double taxation tax agreements (“DTAs”), and being white-listed by the Organisation for Economic Cooperation and Development (“OECD”)....