Indirect Tax News
Issue 2/2022 - April 2022
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The burgeoning interest in virtual currency has been hailed as the “gold rush” of the 21st century, with potentially staggering gains to be made on crypto transactions and owners able to maintain a certain level of anonymity. Tax authorities worldwide are grappling with the tax treatment of cryptocurrency transactions, as well as whether to require that they be reported. The April issue of ITN includes updates on several countries (Bahrain, Czech Republic, Indonesia, Spain and the U.S.), whose authorities have released guidance or policies on the indirect tax treatment of cryptocurrency. While not immediately related to indirect tax, the OECD has launched a public consultation on a global tax transparency framework for the reporting and cross-border exchange of information on crypto assets, including proposed changes to its common reporting standard.
VAT regimes continue to be expanded to cover digital supplies of goods and services by nonresidents to local customers—Cambodia now requires nonresidents to register and account for VAT, Rwanda intends to do so, Ghana has opened a portal for nonresident suppliers to register and file their VAT returns, Mexico has updated the list of nonresidents that have registered for VAT purposes as digital services suppliers and Slovenia has introduced an EU simplification measure allowing nonresident suppliers to avoid VAT registration if they only make supplies to local customers that are subject to reverse charge VAT and do not engage in other transactions that would require a Slovenian VAT number.
In other news, the EU has formally adopted a new VAT directive that modernises the rules on VAT rates and aligns them with EU priorities and also is holding a public consultation on whether the current VAT rules are adapted to the digital age and how digital technology can be used to combat VAT fraud. In addition, the European Commission has proposed a solution to double taxation problems in the context of distance sales of goods imported into the EU under the rules that became effective in July 2021.
To mitigate the cash flow burden on businesses, China is allowing qualifying taxpayers to obtain a refund for excess input VAT credits on a monthly basis. Singapore is increasing its GST rate by two percentage points. The UAE has extended the time for non-UAE businesses to submit a VAT refund claim and updated its voluntary disclosure guide.
Read these compelling articles and more, including the Indirect Tax Bytes column, in the April issue!
Centre of Excellence Chair
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US - crypto transactions
Issue 2/2022 - April 2022
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