We share the latest bite-sized information and updates from Singapore and around the region.
Tax News
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Singapore updates
On 19 June 2026, the IRAS updated its webpage to clarify the implementation phases for GST InvoiceNow, provide clearer guidance for new voluntary and compulsory GST registrants for the 1 April 2026 and 1 April 2028 phases. The update also introduced new grants, including the GST InvoiceNow Transition Grant for SMEs (S$1,000) and larger businesses (S$5,000), as well as the InvoiceNow Queen Bee Grant, alongside other editorial revisions.
The High Court case of Tan Chek Jin Adrian and others v Comptroller of Income Tax [2026] SGHC 132 dealt with the issue of whether the taxpayers, who are medical professionals, had arranged their business in such a way that one of the main purposes of the structuring was to avoid tax.
The High Court dismissed a taxpayer’s application for an extension of time to appeal a Valuation Review Board (VRB) decision, in the case of Shaw Towers Realty (Pte) Ltd v Chief Assessor [2026] SGHC 131. The case arose from a long-running dispute over the annual value of property owned by Shaw Towers Realty, with the court finding that the VRB’s refusal to allow an amendment to the appeal was not subject to appeal – and that, the taxpayer had not justified an extension.
Singapore announced tax and market reforms to strengthen its position as a regional gold hub, including removing the 5% cap on physical precious metals investments under fund tax incentive schemes to encourage greater capital allocation into gold. The measures, alongside new clearing infrastructure and central bank vaulting services, aim to enhance liquidity, attract institutional investors, and reinforce Singapore’s role as a trusted jurisdiction for gold investment and asset management in Asia.
The Board of Review in ZYT v The Comptroller of Income Tax [2026] SGITBR 3 considered whether the Comptroller of Income Tax was justified in invoking Section 33 of the Income Tax Act to disregard a company used by an ophthalmologist to channel her earnings. The issue was whether the income she received as salary and one-tier tax exempt dividends should instead be treated and taxed as her employment income.
The IRAS has updated its webpage ‘Claiming foreign tax credit’ to provide clearer guidance on the steps and documents required for sole proprietors and partnerships to claim foreign tax credit.
The IRAS has updated its webpages ‘Business expenses’ and Tax Treatment of Business Expenses (M-R)’ to provide clarification on the deductibility of payments for related party services. The updates are aligned with the IRAS e-Tax Guide ‘Transfer Pricing Guidelines (Ninth edition)’.
Singapore and Tanzania signed an Avoidance of Double Taxation Agreement on 9 June 2026 which clarifies the taxing rights of both countries on income arising from cross-border business activities, and addresses the double taxation of such income.
On 8 June 2026, the IRAS updated its webpage to include a new FAQ section for registration for Pillar 2 Top-up taxes.
The Ministry of Finance (MOF) has published the draft Finance (Income Taxes) Bill 2026 (the draft Bill) for public consultation. The draft Bill proposes 20 amendments to the Income Tax Act 1947 to give effect to tax measures announced in the 2026 Budget Statement and from the MOF’s periodic review of the income tax system, and two amendments to the Multinational Enterprise (Minimum Tax) Act 2024 to effect changes related to the Pillar Two Global Anti-Base Erosion Model Rules. The public consultation period will run from 8 June to 1 July 2026.
On 4 June 2026, IRAS released the Ninth Edition of its Transfer Pricing Guidelines, introducing a key clarification on the treatment of share-based compensation (SBC) in cost-plus arrangements for intra-group services.
SBC must be included in the Singapore entity’s cost base for purposes of applying the arm’s length mark-up, regardless of whether the costs are incurred, uncharged or notional. From YA 2026 onwards, IRAS has also introduced a concession allowing uncharged and notional SBC to be excluded from the computation of service income.
This issue of our Tax Bulletin highlights the implications of the updated guidance and the key considerations for businesses as they review their transfer pricing policies and positions.
The IRAS has updated the webpage clarify how to determine the OMV of goods intended as gifts as opposed to that that were not originally purchased as gifts.
The IRAS has added a new example on deposits forfeited in early termination of contracts.
The webpage has been updated to confirm that Singapore will implement the Side-by-Side package in accordance with the Inclusive Framework’s agreement.
On 1 June 2026, Bhutan’s National Assembly adopted the Avoidance of Double Taxation Agreement signed with Singapore on 12 May 2026. The Agreement will enter into force after ratification by both countries.
IRAS published a summary of an advance ruling related to the adequacy of economic substance under Section 10L of the Income Tax Act 1947 on 2 June 2026.
On 2 June 2026, the IRAS updated its webpage “Changing GST Accounting Periods” to improve readability and added a new section on how to request changes to GST accounting periods.
On 2 June 2026, the IRAS updated its webpage “Consumers Importing Goods into Singapore” to improve readability and added a new section on “How much GST you pay”.
On 25 May 2026, the IRAS added a new e-learning video on “Module Nine – GloBE and DTT-Related Compliance Obligations” to their website.
The Income Tax Board ruled payments to employee-founders under a share sale agreement are capital, not employment income. This key decision impacts how founder payments are treated in mergers and acquisitions.
The IRAS published a summary of an advance ruling which dealt with the issue of whether a non-GST registered business is required to register for GST when it sells non-residential properties. Excluding the sale of the properties, the annual taxable supplies of the company did not exceed S$1 million. The IRAS ruled that the value of the sold properties need not be included in the value of taxable supplies when determining the company’s liability to register for GST as the sale is one of capital assets.
On 15 May 2026, IRAS updated its webpage to include the following:
- General information on the processing of RICs
- Explained its view on the tax treatment of RICs
- Launch of FormSG for Refundable Investment Credit (RIC) - Sharing of RICs with Nominated Companies (Requires Corppass to login)
The High Court case of Commersol Commodities Pte Ltd v Comptroller of Goods and Services Tax [2026] SGHC 101 dealt with whether a taxpayer disputing additional GST assessments could bypass the statutory appeal process under the Goods and Services Tax Act and proceed directly to judicial review. The High Court dismissed the application, holding that the applicant had failed to exhaust its statutory remedy by not appealing to the GST Board of Review after the Comptroller upheld the assessments on 29 October 2024. It emphasised that the Board of Review is empowered to address all disputes, including allegations of legal error and procedural unfairness, and reaffirmed that judicial review is a remedy of last resort. Accordingly, the court refused to grant the quashing, mandatory and prohibiting orders sought, and awarded costs to the Comptroller. The applicant’s position was further weakened by its delay in pursuing objections, its failure to lodge a Board appeal despite being aware of the process, and its decision to seek judicial intervention only after enforcement and winding-up proceedings had commenced.
Singapore and Bhutan have signed an Avoidance of Double Tax Agreement (“DTA”) on 12 May 2026. This Agreement was signed in Singapore. However, this Agreement is not yet ratified and therefore does not have the force of law.
The Inland Revenue Authority of Singapore (IRAS) has opened the registration portal for in-scope multinational enterprise (MNE) groups under the Multinational Enterprise (Minimum Tax) Act 2024 (MMT Act). With this, MNE groups will take their first step on their Pullar Two compliance journey in Singapore.
Among other decisions, in-scope MNE groups must clearly inform the IRAS of the entity which will serve as the Designated Local DTT Filing Entity (DFE) and the Designated Local GloBE Information Return Filing Entity (GFE). This may require cross-functional collaborative decision-making – engaging tax, finance, and legal teams, confirming accountability, and ensuring the appointed entity has the necessary authority, appropriate personnel and data access to fulfil the filing requirements.
For in-scope MNE groups with a financial year that ended on 31 December 1 January 2025, the deadline to complete registration is 30 June 2026. Taking action early to obtain the information and internal sign-offs are critical to meeting the deadline.
This case deals with the issue of whether the Comptroller of Goods and Services Tax (the Comptroller) had incorrectly denied the Appellant's claim for input tax related to goods supplied to the Appellant in numerous disputed transactions in an accounting period, in a case of missing trader fraud. The Goods and Services Tax Board of Review dismissed the appeal as the Appellant failed to prove on a balance of probabilities that the goods described in the tax invoices were genuinely supplied or that the transactions were part of a legitimate business.
The File Form C-S/Form C-S(Lite)/Form C digital services on the IRAS webpage is now available.
The ‘Agreement between the Government of the Republic of Singapore and the Government of the Republic of Kenya for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance’ entered into force on 20 April 2026 and takes effect on 1 January 2027.
On 14 April 2026, Singapore signed the Multilateral Competent Authority Agreement on the Exchange of Global Anti-Base Erosion Information to facilitate its participation in the central filing of GloBE Information Returns.
Singapore’s participation in the central filing is intended to reduce the compliance burden of in-scope Singapore-headquartered multinational enterprises. The Singapore tax authorities assured taxpayers in a media release that their information would be safeguarded and that information will only be exchanged with international partners that have the necessary safeguards in place to ensure confidentiality of the information exchanged and to prevent unauthorised use of such information.
With heightened uncertainties in the global environment leading to higher costs, the Government has announced a set of targeted support measures on 7 April 2026 to help businesses and households manage the near-term challenges. The measures emphasise cost containment, cash-flow relief and continuity of essential services, with several initiatives taking effect immediately.
Measures introduced to help businesses include an increase to the Corporate Income Tax (CIT) rebate from 40% (as announced earlier in the Budget 2026) to 50%, with the minimum benefit raised from $1,500 to $2,000. The maximum benefit a company can receive has also been increased from $30,000 to $40,000.
In the case of GIX v The Comptroller of Income Tax [2026] SGITBR 2, the Income Tax Board of Review dealt with the issue of whether the gain on disposal of a building extension was income in nature and hence taxable.
The taxpayer developed, owned and operated a building. An extension to the building was subsequently developed. However, it took the taxpayer several years to acquire the leasehold interest in the land on which the building extension was eventually developed, and while negotiations with the lessor were ongoing, a number of events transpired concurrently including the grant of first right of refusal to the eventual purchaser of the building and the extension. The taxpayer eventually entered into a sale and leaseback agreement with a real estate investment trust (REIT) to sell the building ‘as is’, and the extension upon completion of its construction. The Comptroller of Income Tax (the Comptroller) agreed that the gain on sale of the building was capital and not taxable, but treated the gain on disposal of the extension as income in nature and taxable under section 10(1)(g) of the Income Tax Act 1947 (the Act).
The Board held that the appropriate test for determining whether the gain was taxable was that set out in the case of IB v Comptroller of Income Tax [2004] SGITBR 10, whether ‘at the time the transaction was entered into the taxpayer had the intention or purpose of making a profit from that transaction’, and upon consideration of the whole of the circumstances surrounding the transaction, the Board dismissed the taxpayer’s appeal.
As the Board noted, there is now substantial jurisprudence in Singapore on the matter of when non-trading gains or profits may constitute gains or profits of an income nature under section 10(1)(g) of the Act. While it is well-established that the taxpayer’s intention at the time of entering into the transaction is one of the badges of trade to be considered to determine if a gain is capital or income, the long-drawn negotiations leading up to the acquisition in this transaction highlights that an objective assessment of the taxpayer’s intention requires a consideration of all the facts of the surrounding circumstance over the relevant period of time.
The Income Tax (Refundable Investment Credits) (Amendment) Regulations 2026 came into operation on 1 April 2026. The amendments mainly set out administrative and operational rules such as:
- The circumstances under which awards of refundable investment credits (RICs) may be amended.
- The rules under which companies may apply for the RICs to be offset against taxes of a related company, transferred to another and the effect of such offset and transfer.
- The government’s right to recover RICs previously awarded where a nominee ceased to be a related company and the attendant consequences.
On 6 March 2026, the Second Protocol to the tax treaty between Singapore and Cambodia entered into force. The protocol was signed on 2 November 2023. Amendments to the treaty include changes to the preamble and the introduction of a new article to incorporate the internationally agreed standards for countering treaty abuse, among other technical amendments.
The amendments are in accordance with the Multilateral Convention to Implement the Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting signed by Singapore on 7 June 2017.
The countdown to mandatory GST InvoiceNow has begun, with full implementation targeted by 2031. We unpack who will be affected, the key timelines to watch, and the practical considerations for planning your implementation roadmap.
In GIW v The Comptroller of Income Tax [2026] SGITBR 1, the Income Tax Board of Review considered whether expenditure on a cement silo qualifies for capital allowances as 'plant' or 'machinery' under section 19A of the Income Tax Act 1947 (the Act). Following Singapore Cement Manufacturing Co Pte Ltd v CIT [2023] 5 SLR 1099, the taxpayer shifted from an 'integrated whole' claim to a component-based case that the inverted cone, silo walls, and discharge system are themselves 'plant' or 'machinery'. The Board held that this shift were new grounds not stated in the Petition of Appeal and, in applying section 79(12) of the Act, granted consent to raise them with directions. The determination of whether the identified components qualify as 'plant' or 'machinery' eligible for capital allowances under section 19A of the Act is reserved for the merits hearing.
A new ‘Agreement between the Singapore Trade Office in Taipei and the Taipei Representative Office in Singapore for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance’ entered into force on 13 February 2026 and is effective 1 January 2027. It replaced an earlier agreement in effect since 1 January 1982.
Among other changes, the new agreement lowers the withholding tax rates on dividends and royalties. It also contains articles on interest and capital gains, which were absent in the previous agreement.
International updates
Our latest Tax Policy Bulletin includes tax highlights on the Budget 2026, signing of the new UK/NZ double tax agreement, and our usual as coverage of publications and consultation items.
A recent ruling of the Delhi bench of the Income-tax Appellate Tribunal (Tribunal) involved the sale of non-convertible debentures (NCD) of an Indian company by a Singapore resident. The sale was made on a cum-interest basis, including five days of broken period interest. The taxpayer claimed the entire sale amount as non-taxable capital gains under the India-Singapore Double Taxation Avoidance Agreement (DTAA). Revenue treated the broken period interest as taxable ‘interest income’. The Tribunal affirmed Revenue’s action and concluded that the nature of the receipt as interest remained unchanged.
On 17 June 2026, the Inland Revenue (Amendment) (Automatic Exchange of Information) Bill 2026 (Bill), as amended by the committee stage amendments (CSAs), passed its third reading in the Legislative Council. The CSAs are technical in nature and are intended to enhance the clarity of the relevant provisions. It is expected to be gazetted as the amendment ordinance on 26 June 2026 (new law).
The OECD is inviting public feedback on suggested changes to its Model Rules for Reporting by Platform Operators with respect to Sellers in the Sharing and Gig Economy. The suggested changes focus on refining the role of intermediaries in facilitating transactions within the digital economy, with the aim of improving clarity, consistency and effectiveness in taxpayer reporting obligations.
Several important Belgian Pillar 2 compliance developments have been announced in recent days. Most notably, Royal Decrees published in the Belgian Official Gazette confirm the final return forms for the Belgian Qualified Domestic Minimum Top-up Tax (QDMTT) for assessment year 2025 and the Income Inclusion Rule (IIR) top-up tax for assessment years 2024 and 2025.
In addition, the Belgian tax authority has extended the filing deadline for the GIR Notification. This extension does not apply to any GloBE Information Return (GIR) that must be filed in Belgium.
The Bureau of Internal Revenue (BIR) announced that it has started preparing for the possible implementation of a Qualified Domestic Minimum Top-Up Tax (QDMTT) after receiving feedback from multinationals that they prefer to comply with a domestic minimum tax regime than with unfamiliar rules in other jurisdictions.
Following an industry consultation and further engagement sessions in 2024 and 2025, the long-awaited Inland Revenue (Amendment) (Preferential Tax Regimes for Funds, Family-owned Investment Holding Vehicles and Carried Interest) Bill 2026 (Bill) seeking to implement the enhancements to the preferential tax regimes for privately-offered funds, family-owned investment holding vehicles (FIHVs) and carried interest will be gazetted on 12 June 2026.
The Hong Kong government introduced a new ‘Action Plan to Promote the Development of Corporate Treasury Centres in Hong Kong’ which utilises a "4T" framework to encourage multinational corporations to centralise their treasury functions and risk management in Hong Kong.
The "4T" strategic framework:
- Tax revamp: Competitive-tiered tax incentives and a "pre-approval" mechanism to increase tax certainty of operating in Hong Kong.
- Tax agreements: Continuous expansion of the Comprehensive Double Taxation Agreement network to promote greater tax certainty and avoidance of double taxation.
- Targeted promotion: Proactive global marketing to attract enterprises, particularly from the Chinese Mainland and Asia, and those in new economy sectors.
- Talent & dialogue: Cultivating professional talent, building a high-quality talent pool and driving regular industry-government dialogue.
On 5 June 2026, Türkiye ratified the Multilateral Competent Authority Agreement on the Exchange of GLOBE Information. It is considered a signatory to the agreement from 20 April 2026.
The OECD has published ‘Guidance on the Use of the GIR XML Schema and Validation Rules for First GIR Filings and Exchanges’ which contains guidance for the use of the GIR XML Schema for first GloBE filings and exchanges in 2026 through practical fixes, workarounds and the switch-off of certain validation rules.
Kuwait has ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) which it signed on 7 June 2017. At the time of signature, Kuwait identified 45 treaties to which it intends to apply the MLI, including its treaty with Singapore.
The Hong Kong Inland Revenue Department has issued a ‘Supplementary User Guide for Preparing the GloBE Information Return’ detailing what information needs to be included in some data elements to be reported in the GloBE return. It should be read in conjunction with the GIR XML Schema User Guide issued by the OECD.
In this issue:
Income Tax
- The Ministry of Finance issued amendments to the Directions for the Assessment of Income Tax on House and Land Transactions on April 21, with immediate effect.
- On May 13, 2026, the Ministry of Finance and the Ministry of Economic Affairs jointly announced amendments to the “Rules Governing the Applications for Exemption from Income Tax on Royalty and Technical Service Fees Collected by Foreign Profit-Seeking Enterprises from Manufacturing Industries, Technical Service Industries and Power-Generating Industries,” effective immediately.
In this issue:
- Updates on e‑Invoice implementation
- e‑Invoice as a data source for personal relief
- Updated Global Minimum Tax Frequently Asked Questions
- Submission of appeals online via MyTax portal.
In this episode of Cross-border Tax Talks, Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Dr. Alexis Crow, partner and Chief Economist for PwC US. Prior to joining PwC, Alexis taught at the London School of Economics. Doug and Alexis discuss the macroeconomic and geopolitical implications of the Iran conflict, including energy-market scarring, oil-price scenarios, fiscal supports, inflation pressures, and central-bank constraints. They also examine the durability of US growth, AI-driven investment, consumer demand, and private credit risk; then move through global trade developments and regional dynamics across Asia-Pacific, Latin America, Europe, and North America. The conversation closes with the “re-industrial era,” energy addition, automation, workforce skills, and financial-stability risks that may be underappreciated.
This video covers the OECD’s consultation on proposed revision to Chapter VII of the Transfer Pricing Guidelines, Vietnam’s draft APA framework reforms, and the latest developments in the 3M transfer pricing litigation.
In a recent order, the Supreme Court dismissed the Revenue’s review petitions relating to the software taxation issue in favour of the taxpayer.
Despite the Supreme Court having decided the issue of software taxation in favour of taxpayers by its judgement dated 2 March 2021, the Revenue, in certain instances, continued to litigate and dispute this issue citing pendency of its review petition against the detailed judgement before the Supreme Court. With the dismissal of these review petitions filed by the Revenue, the issue with regard to software taxation can now be said to have attained finality.
Consequently, amounts paid by resident Indian end-users or distributors to non-resident computer software manufacturers or suppliers for resale or use of computer software cannot be classified as royalty under Article 12 of the relevant tax treaties.
Where the treaty definition of ‘royalties’ is more beneficial than the domestic law definition, the treaty will prevail by virtue of section 90(2) read with Explanation 4 of the Act thereof.
PwC New Zealand’s latest Tax Policy Bulletin includes a Budget 2026 preview and a high-level summary of some key Pillar 2 considerations, as well as the usual coverage of publications and consultation items.
The Delhi bench of the Income-tax Appellate Tribunal (Tribunal) has emphasised that the determining factor for the exemption of royalty income from tax under section 9(1)(vi)(b) of the Income-tax Act, 1961 (the Act) is the situs of ‘income’ rather than the situs of ‘receipts’. This distinction is crucial when assessing whether royalty income on export sales qualifies for the exemption. The Tribunal further clarified that the place where the contract is concluded is one of the critical factors, if not the deciding factor, in establishing the situs of income. Consequently, the Tribunal remanded the issue of taxability of royalty income on export sales back to the Tax Officer (TO), directing an examination of whether the contracts were signed inside or outside India.
With population ageing being a major structural trend across OECD countries that could have significant implications for public finances, the OECD has published a working paper examining the potential effects of demographic change on tax systems and how tax design may further exacerbate revenue pressures. The paper then analyses the implications of population ageing for labour income tax revenues as the working-age population evolves and considers how the relative importance of other tax bases such as consumption, capital income, and wealth-related taxes, may change depending on policy design. The paper also highlights how tax system vulnerability to ageing is shaped by both demographic trends and tax design and discusses potential policy considerations and areas of further work..
The OECD opened a consultation on a revised Chapter VII of the Transfer Pricing Guidelines (intragroup services) on 1 June 2026, with comments due 22 July 2026 and a public consultation to be held in November. The objective is to align Chapter VII with Chapters I–III and add practical illustrations without changing the underlying principles. The draft is a substantial revision introducing granular analysis, an expanded benefit test, a sharper shareholder/stewardship distinction, detailed service–intangible boundary guidance, method selection beyond cost-plus, pass-through cost rules, services-specific documentation expectations, and 21 new examples. Low value-adding services (LVAS) remain unchanged. The draft is not yet consensus guidance and should not be relied upon as such.
On 1 June 2026, a Royal Decree has been published in the Belgian Official Gazette establishing the official template for the Qualified Domestic Minimum Top-Up Tax (QDMTT) return for assessment year 2024. The published return is applicable for fiscal years that started on or after 31 December 2023 but ended on 30 December 2024 at the latest. Note that the Belgian Pillar 2 law is applicable for fiscal years that started on or after 31 December 2023.
The official QDMTT return template released for assessment year 2024 is aligned with the latest draft version released by the Belgian tax authorities in March 2026.
On 28 May 2026 the Australian Government introduced into Parliament the Bills (Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 and Income Tax Rates Amendment (Tax Reform No. 1) Bill 2026) to give effect to its 2026-27 Budget capital gains tax (CGT) and housing tax reform measures.
Cyprus’s income inclusion rule should be treated as in line with the OECD’s global anti-base-erosion rules even though the measure is not listed in the organization’s central record of pillar 2-compliant legislation, the European Commission said.
UN and OECD initiatives on digital service taxation are progressing simultaneously, reflecting differing approaches and interests. Meanwhile, companies face operational challenges with reporting requirements, highlighting the complexities and uncertainties in the evolving international tax landscape.
The Division Bench of the Supreme Court of India overturned the Karnataka High Court decision and held that a trust engaged in multiple businesses is entitled to claim deduction of interest paid on capital borrowed for business purposes under section 36(1)(iii) of the Income-tax Act, 1961 (the Act) based on the principles of commercial expediency, even if a portion of the funds was advanced to other group companies.
Finance Minister Nicola Willis has delivered the Government’s 2026 Budget which includes a wide-ranging package of tax measures. Covering areas from banking and not-for-profits to aircraft leasing, fringe benefit tax, R&D, shareholder loans, foreign investment and Working for Families, this year’s Budget has a broader than seen in recent years.
International Tax News is designed to help multinational organisations keep up with the constant flow of tax developments. Among the topics featured in this month's edition are:
- OECD attempts to address Global Minimum Tax compliance concerns in advance of filing and exchange deadlines
- Substance compliance requirements for Panamanian offshore entities
- Canada releases draft legislation to defer the UTPR
- Chilean tax bill would lower corporate rate, integrate tax system, and provide stability regime
The French and Australian tax authorities will grant relief to taxpayers filing their initial global minimum tax information returns, in line with a common understanding among jurisdictions applying the global anti-base-erosion rules starting in 2024.
The OECD has again incorporated recent administrative guidance into its consolidated commentary on the global anti-base-erosion rules, including the so-called side-by-side package and clarifications on the application of the transitional undertaxed profits rule safe harbor.
Following the two-month consultation conducted from December to February, the bill that seeks to implement the Crypto-Asset Reporting Framework (CARF) and the amended Common Reporting Standard (CRS) (Bill) was gazetted on 22 May 2026. This marks an important step in Hong Kong’s alignment with the evolving global tax transparency framework and in addressing the reporting gap for crypto-assets.
On 28 May 2026, the OECD published the consolidated commentary incorporating Agreed Administrative Guidance that has been released by the Inclusive Framework from March 2022 through January 2026.
The German Ministry of Finance is asking for stakeholder feedback on a draft tax bill that proposes implementing key elements of the OECD’s pillar 2 side-by-side tax package, including an exemption for U.S.-parented companies.
In this podcast, Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Will Morris, PwC’s Global Tax Policy Leader, at PwC’s Asia-Pacific Global Tax Symposium in Hong Kong. Doug and Will discuss the acute uncertainty surrounding Pillar Two filing readiness as first wave filing deadlines approach, including the OECD’s common understanding document of 18 May 2026, GIR central filing, local filing portals, XML schema differences, penalty relief, safe harbour elections, QDMTT and top-up tax returns, taxpayer outreach to BIAC, the OECD, and national governments, the OECD implementation toolkit, 52/53-week fiscal-year UTPR guidance, and unresolved dispute resolution questions.
Following a two-month consultation earlier this year, the HKSAR Government (Government) has recently set out in a paper submitted to the Legislative Council Panel on Commerce, Industry, Innovation and Technology its refined proposals to expand the profits tax deduction for capital expenditure on intellectual property (IP). The original consultation paper covered two broad areas: (1) allowing deductions for covered IP acquired from associates; and (2) allowing deductions for upfront licence fees for the right to use covered IP.
The refined proposals enhanced certain aspects of the original proposals and, most notably, introduced a new proposal allowing deductions for the relevant purchase cost of covered IP used by a licensee outside Hong Kong, where the related licensing income is taxable under the foreign-sources income exemption (FSIE) regime.
The Swedish government is seeking input on proposals to amend the country’s minimum tax law so qualified domestic minimum top-up tax (QDMTT) liabilities fall on joint ventures and their subsidiaries, in line with OECD guidance.
On 26 May 2026, Jessica Di Maria and Lee Harley of the OECD Centre for Tax Policy and Administration penned a blog post exploring how OECD guidance on remote work and the OECD Model Tax Convention help businesses navigate taxable presence and apply international tax rules in a changing, digitalised economy.
Following recent legislative amendments and Inland Revenue publications impacting employment tax, PwC New Zealand latest Tax Tips covers what this means for Fringe Benefit Tax, PAYE and contractor alignment, KiwiSaver, employee share schemes, and more.
In a recent ruling, the Mumbai bench of the Income-tax Appellate Tribunal (Tribunal) upheld that a taxpayer can choose to be governed by the provisions of the Income-tax Act, 1961 (the Act) or the relevant Double Taxation Avoidance Agreement (DTAA) for each transaction of transfer of shares independently.
For financial year (FY) 2021-22, the taxpayer claimed exemption on long-term capital gains (LTCG) under the India-Singapore DTAA on transfer of shares of the first company acquired prior to 1 April 2017. Simultaneously, it claimed long-term capital loss (LTCL) on transfer of shares of the second company also acquired prior to 1 April 2017 under the Act and set off such loss against LTCG arising from the transfer of shares of other companies acquired post 1 April 2017.
The tax authorities argued that all such share transactions must be aggregated and taxed under either the Act or the DTAA.
On 5 May 2026, the Government issued Decree 144/2026/ND-CP which takes effect from 20 June 2026. Changes have been made to the VAT treatment of debt sales including sales of receivables and certificates of deposit by certain taxpayers, the treatment of exported natural resources and minerals and VAT exemption of insurance brokerage commissions relating to insurance services.
A new OECD “common understanding” claims to ease pressure around 30 June GloBE Information Return filings, but the “relief” may prove too narrow, too late, and too dependent on local implementation to resolve mounting compliance challenges.
Revenue Memorandum Circular (“RMC”) No. 47-2026 has been issued on 19 May 2026, pursuant to Section 5(J) of Revenue Regulations (RR) No. 7-2024 and RMC No. 91-2024, implementing Republic Act (RA) No. 11976 or the “Ease of Paying Taxes” Act. This Circular is hereby implemented to simplify, standardize, and streamline the guidelines and procedures in the processing of applications or closure and/or cancellation of taxpayer's business registration with the Bureau of Internal Revenue (“BIR”).
On 18 May 2026 the OECD released a ‘common understanding’ by jurisdictions that implemented a qualified income inclusion rule and/or qualified domestic minimum top-up tax for the 2024 reporting fiscal year, aiming to mitigate the impact of potential delays in the availability of fully operational GloBE Information Return (GIR) filing portals or exchange relationships for the Global Minimum Tax. Separately, the OECD/G20 Inclusive Framework on BEPS released agreed administrative guidance to extend the qualifying period for the transitional UTPR safe harbour to certain 52/53-week fiscal year multinational enterprise (MNE) groups and updated its Central Record, which lists the jurisdictions whose local implementation of the global minimum tax rules has been assessed as “transitionally qualified”. implementation.
The Chennai bench of the Income-tax Appellate Tribunal (Tribunal) recently concluded that shares held as investment constitute capital asset and that the tax authorities cannot question commercial expediency in the absence of evidence of a sham transaction or lack of commercial substance. The Tribunal was of the view that the transfer of shares by the France-based taxpayer of its wholly owned Indian subsidiary to another wholly owned Indian subsidiary is a bona fide transaction covered by section 47(iv) of the Income-tax Act, 1961 (the Act) and is thus not liable to tax in India. Furthermore, the Tribunal reiterated that the Revenue cannot step into the shoes of a businessperson and dictate how transactions should be structured.
The May issue of the Samil Commentary includes the following:
- Ministry of Finance and Economy (MOFE) proposes amendments to implement tax incentives for the National Growth Fund
- Ministry of the Interior and Safety (MOIS) proposes amendments to Local Tax Revenue-related Laws for the first half of 2026
- National Tax Service (NTS) issues guidance on Korea’s first Pillar Two Global Minimum Tax filing, due June 30, 2026
Following the issuance of PMK-136 to implement the Top-up Tax mechanism under the Global Anti-Base Erosion (GloBE) Rules in Indonesia, on 4 May 2026, the Director General of Taxes (DGT) issued PER-6 to stipulate its administrative implementation.
International Tax News is designed to help multinational organisations keep up with the constant flow of tax developments.
Among the topics featured in the April edition are:
- Proposed changes to Australian foreign resident CGT rules
- Hong Kong introduces bill to strengthen CRS framework
- Singapore updates regulations on refundable investment credits
- Bolivia abolishes financial transactions tax
The Government has just released a draft decree providing guidance on the new Personal Income Tax law pertaining to taxation in respect of certain sales of shares by individuals. The new rules are anticipated to come into force on 1 July 2026.
The Mexican Federal Tax Court (Tribunal Federal de Justicia Administrativa – TFJA) issued several isolated precedents examining the concept of beneficial ownership in the context of dividends and interest paid under Mexico’s tax treaties. In these decisions, the court concluded that an entity resident in a treaty jurisdiction will not be regarded as the beneficial owner where, based on contractual arrangements or a broader assessment of the surrounding facts and circumstances, it is effectively required to transfer the income to a related-party resident in a third jurisdiction (even if the third jurisdiction has a tax treaty with Mexico).
On 10 April 2026, the Australian Government released draft legislation that aims to strengthen the foreign resident capital gains tax (CGT) regime. First announced in the 2024-25 Federal Budget, the proposed amendments are designed to ensure that CGT applies when foreign residents dispose of assets with a close economic connection to Australian land and natural resources. The Government has provided very limited transitional relief for investment into the Australian renewables sector as part of the energy transition by introducing a four-year time-limited 50% CGT discount for foreign resident investors in Australian renewable energy assets. Consultation on the draft legislation closed on 24 April 2026.
The ATO has released its legislative instrument that provides certain exemptions from lodging Pillar Two tax returns in Australia.
The Delhi bench of the Income-tax Appellate Tribunal (Tribunal) has concluded that, in the absence of explicit provisions in the Double Taxation Avoidance Agreement (DTAA), the concept of Virtual Service Permanent Establishment (VSPE) cannot be imported into the DTAA by implication. The Tribunal further unequivocally affirmed that the physical presence of employees or personnel in India is an essential and indispensable requirement for the constitution of a service permanent establishment (PE) under Article 5(2)(k) of the India-UK DTAA.
The Bombay High Court, in a recent decision, dismissed the Revenue’s appeal and upheld the order of the Income-tax Appellate Tribunal, deleting the disallowance under section 40(a)(ia) of the Income-tax Act, 1961 (the Act) of cross charges paid by the taxpayer to a related party under a cost sharing agreement, ,where tax deducted at source (TDS) was not accounted for. The court held that the charges represented pure reimbursements of actual costs, without any mark-up or embedded income component, and therefore not liable for TDS.
A draft law amending the current Law on Customs has been published for feedback and comments. The draft aims to improve the legal framework, strengthen state management, and further facilitate import and export activities.
At the World Trade Organization’s (WTO) 14th Ministerial Conference (MC14), held from 26–29 March 2026, members were unable to reach a consensus on extending the moratorium on customs duties for electronic transmissions, such as software downloads, cloud services, video games, music, e-books etc. Although often referred to as an “e-commerce moratorium”, it does not apply to other forms of what the WTO defines as e-commerce: “the production, distribution, marketing, sale or delivery of goods and services by electronic means”.
An overview of China’s tax policies from 2025 to 2026 and tax guides to 17 popular investment destinations for Chinese enterprises going global.
Earlier in March, the Finance and Expenditure Committee (FEC) reported the Taxation (Annual Rates for 2025-26, Multinational Tax, and Remedial Matters) Bill (the Bill) back to Parliament. This was followed by amendment papers No 559 and 560 (the Amendment Papers) which introduce a number of additional matters to the Bill including, primarily, a relaxation of thin capitalisation rules for foreign investments in New Zealand infrastructure projects. Last night the Bill was enacted as the Taxation (Annual Rates for 2025–26, Compliance Simplification, and Remedial Measures) Act 2026.
The Bureau of Internal Revenue (BIR) has issued Revenue Memorandum Circular No. (RMC) No. 24-2026, to clarify the application of RMC Nos. 5-2024 and 38-2024 on the taxation of cross-border services, ensuring alignment with the Supreme Court ruling in Aces Philippines and providing certainty to both revenue officers and taxpayers.
International Tax News is designed to help multinational organisations keep up with the constant flow of tax developments.
Among the topics featured in the March edition are:
- Australia proposes Pillar Two amendments to align with the OECD
- CJEU rules Belgium breached ATAD CFC rules
- Colombia introduces a new equity tax
- Italy and Mexico address 'beneficial ownership'
International Tax News is designed to help multinational organisations keep up with the constant flow of tax developments.
Among the topics featured in the February edition are:
- US Supreme Court invalidates IEEPAQ tariffs
- Venezuelan tax changes aim to reactivate oil investments
- Alignment of the DMTT with Uruguay’s Tax Stability Regimes
- Canada releases second package of hybrid mismatch rules
Financial Secretary Paul Chan Mo-po delivered the 2026/27 Hong Kong Budget on 25 February 2026 under the theme ‘Driving High-quality, Inclusive Growth with Innovation and Finance’. Building on the strong economic momentum of 2025, the 2026/27 Budget introduces targeted measures aligned with the national 15th Five-Year Plan to lay the foundation for Hong Kong’s next chapter of innovation-led and inclusive growth. It is a balanced budget, carefully calibrated to reinforce Hong Kong’s resilience in the face of an uncertain external environment.
The US Supreme Court on February 20 held that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs absent clear congressional authorization. In a 6–3 decision, the Court concluded that although IEEPA permits the President to “regulate” importation during a declared national emergency, that language does not clearly authorize the imposition of tariffs.
The OECD made available a Pricing Automation Tool which is designed to automatically compute the Amount B return for an in-scope tested party, requiring only minimal data inputs. It is intended to further optimise the administrative and simplification benefits of Amount B for both tax administrations and taxpayers. The tool will be updated annually to reflect any changes to the pricing matrix and other datapoints relevant to application of Amount B adjustment features.
On 16 February 2026, the OECD released the Carbon Pricing and Energy Taxation Database, which allows users to track developments in energy taxation and carbon pricing by year, country, sector, energy or emissions source, and policy instrument.
Our annual publication of the Global Crypto Tax Report arrives at a pivotal moment in the development of the crypto ecosystem. The industry is increasingly regulated, which has driven huge changes in the business models of those operating in the sector and is resulting in convergence between the crypto sector and traditional financial services. Tax transparency in crypto has also been a key theme, with the introduction of the OECD’s Crypto Asset Tax Reporting Framework, which is now live in many jurisdictions.
On 14 July 2025, the Legislative Assembly of the Macau Special Administrative Region (Macau) passed the Investment Fund Law, which took effect on 1 January 2026. The new legislation aligns Macau's regulatory framework for investment funds with international standards, strengthens investor protection, and removes longstanding barriers in the management, operation, and development of investment funds that persisted under the previous law for 25 years. This provides a solid foundation for further enhancing Macau's environment for investment fund management and development.
On 15 January the Government released Decree 20 providing guidance on certain provisions in Resolution 198/2025/QH15. The guidance in Decree 20 generally took effect on 15 January 2026, except for certain clauses which apply to the 2025 tax year or from the effective date of Resolution 198, i.e. 17 May 2025.
Union Budget 2026-27 – Catapulting India's next growth leap
The Union Budget 2026-27 charts a path for India’s continued growth, reinforcing the Government’s commitment to fiscal discipline, and reform-led progress. Anchored around the three-dimensional framework - i) accelerating and sustaining economic growth, ii) fulfilling aspirations and building capacity, and iii) ensuring inclusive growth, the Budget sets out a comprehensive reform agenda. Key focus areas include scaling up manufacturing across strategic and frontier sectors, supporting MSMEs, enhancing infrastructure and energy security, deepening the services sector as an employment engine, investing in human capital, and promoting balanced regional development through city economic regions and targeted initiatives.
India Budget 2026: Impact on foreign investors and multinationals
India’s Finance Minister presented the Union Budget for 2026–27 (Budget 2026) on February 1, 2026. The budget continues the government’s development agenda, with an emphasis on manufacturing, the ‘Make in India’ initiative, employment-led development, human capital investment, energy security, export promotion, and innovation.
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