Welcome to issue 2  of Weekly Alert covering technical development in taxation around the globe.
TAX – Hong Kong
1. Government Launches Consultation on Legislative Proposals to Enhance Regulatory Regime for Combating Money Laundering and Terrorist Financing
On 6 January 2017, the Financial Services and the Treasury Bureau launched the following two consultation exercises:
- Public consultation on a proposal to amend the Companies Ordinance to improve the beneficial ownership transparency for companies incorporated in Hong Kong; and
- Stakeholder consultation to seek views from affected industries on a proposal to amend the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance, requiring designated non-financial businesses and professions to conduct customer due diligence when they engage in specified transactions.
The intention of the two legislative proposals is to bring Hong Kong's regulatory regime up to date in line with international requirements, as promulgated by the Financial Action Task Force.
Both consultations will last for two months, under 5 March 2017.
Proposal on Enhancing Transparency of Beneficial
Ownership of Hong Kong Companies
Proposal on Enhancing Anti-Money Laundering Regulation
of Designated Non-Financial Businesses and
2. Change of Postal Address of Taxpayers
The Inland Revenue Department ("IRD") will issue the "Tax Return – Individuals" (BIR60) on 2 May 2017.
Taxpayers have to notify the IRD of the change of their postal address not later than 2 March 2017 to ensure that the tax returns can be sent to their new address.
Change of Postal Address of Taxpayers
TAX – PRC
1. Circular on the Import Tax Policy for Supporting the Technological Innovation
On 27 December 2016, the Ministry of Finance ("MOF"), General Administration of Customs ("GAC") and State Administration of Taxation ("SAT") jointly issued the ''Circular on the Import Tax Policy for Supporting the Technology Innovation during the 13th Five-Year Period''.
According to the Circular, the importation of equipment, instruments and other teaching materials which cannot be manufactured in China and are imported by scientific research institutions, technological development institutions and schools, the related import duty, import value-added tax and consumption tax will be exempted. The exemption applies from 1 January 2016 to 31 December 2020.
2. Circular on the Tax Policy for Importing Petroleum/Natural Gas Exploration Materials
On 29 December 2016, the MOF, GAC and SAT jointly issued the ''Circular on the Tax Policy for Importing Petroleum/Natural Gas Exploration Materials during the 13th Five-Year Period''.
According to the Circular, for the importation of equipment, instruments and other materials which cannot be manufactured in China and are imported for the use of petroleum/natural gas exploration in specified region in China, if the import is made within the tax exemption quota, the related import duty and import value-added tax will be exempted. The exemption applies from 1 January 2016 to 31 December 2020.
TAX – International
1. Ecuador Minister Discusses Need for United Nations Body with Transparency Advocates
Ecuador Foreign Minister Guillame Long is expected to express support for a United Nations body to focus on global tax issues, corruption and transaparency at an event in Washington.
In February 2017, Ecuador will hold a referendum on whether to bar public servants from holding office if they hide money or assets in tax havens. Recent estimates from the Economic Commission on Latin America and the Caribbean indicate that the region loses 6.7% of its GDP to tax evasion.
Ecuador Minister Discusses Need for United Nations Body
with Transparency Advocates
2. Interaction Between the Tax Treaty Provisions of the Report on BEPS Action 6 and the Treaty Entitlement of non-CIV Funds
On 6 January 2017, the Organisation for Economic Co-operation and Development ("OECD") released for public comment three draft examples addressing the application of principal purpose test under Action 6 of the Base Erosion and Profit Shifting ("BEPS") Project on preventing the granting of treaty benefits in inappropriate circumstances and the treaty entitlement of non-collective investment vehicle ("non-CIV") funds.
The OECD invites interested parties to send their comments on these three examples by 3 February 2017. All the comments on the examples will be made publicly available.
Interaction Between the Tax Treaty Provisions of the
Report on BEPS Action 6 and the Treaty Entitlement of non-CIV
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.