Indirect Tax News
Issue 3/2021 - October 2021
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EDITOR's LETTER
In the world of indirect taxes, the topic of e-commerce is still hot. Thailand is now the fourth country in Southeast Asia to introduce VAT on electronic services, having done so after Indonesia, Malaysia and Singapore. Other countries, including Saudi Arabia, have provided further guidance on how to treat e-commerce transactions for VAT or GST purposes. My US colleagues also reflect on the Wayfair case and its impact on sales tax revenues for US states. In the EU, the European Court of Justice issued an important ruling in the Titanium case, in which the Court ruled that there is no fixed establishment for VAT purposes when there is no staff present in the country where an immovable property is leased to a lessee. I wonder whether the same reasoning could be applied if services or goods were supplied in an automated manner. Food for thought if you are interested in indirect taxes.
In other news, Israel is joining the growing number of countries that levy VAT or goods and services tax on digital services supplied from outside the country to local consumers. Proposed legislation that is proceeding through the Israeli parliament would require nonresident providers of online services to Israeli private customers to register for VAT purposes and collect and remit a 17% VAT to the Israeli tax authorities.
Finally, Poland would like to make the formation of VAT groups possible starting in 2022. Under the proposed VAT group rules, intragroup transactions would not be taxed, and a group would be able to report VAT by filing a single return.
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TOM KIVLEHAN
Indirect Tax
Centre of Excellence Chair
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OUR HIGHLIGHT:
EU - TitaNIUM case
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Issue 3/2021 - October 2021
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