- Article
- February 18, 2015
In two previous financial years India has grown below 5% mainly because of the global slowdown coupled with domestic economic sluggishness. Reserve Bank of India expects the economy to pick up and grow at over 5.5 per cent by March 2015. Moreover, the formation of a new government which reflected in the stock market surge and strengthening of the domestic currency.
CLIs (composite leading indicators) suggest “the growth momentum is weakening in most major emerging economies. As a whole for the OECD and for the United States and Canada, CLIs purpose to stable growth momentum.
The growth momentum is expected to stabilize at above-trend rates, while in Japan it points to an intermission in its growth momentum, in case of the United Kingdom. CLIs continue to indicate a positive change in momentum in the euro area as a whole and in Italy. CLIs point to a stable growth momentum in France and Germany.
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- Article
- February 18, 2015
For Global Economic Outlook the World Bank has Lowered Projections and urged developing countries to double down on domestic reforms.
GDP growth in South Asia slowed to an estimated 4.7% in market price terms in 2013, this weakness mainly reflected in manufacturing activity and a sharp slowing of investment growth in India. Most of the acceleration is India’s localized, supported by a gradual pickup of domestic investment and rising global demand. To improve fiscal consolidation continues, labor productivity and a credible monetary policy stance is maintained by the forecasts assume that reforms are undertaken to ease supply-side constraints (particularly in energy and infrastructure). Growth in India is projected at 5.5% in FY2014-15, accelerating to 6.3% in 2015-16 and 6.6% in 2016-17.
As the year progresses the global economy is expected to pick up speed and is projected to expand by 2.8% this year, strengthening to 3.4% and 3.5% in 2015 and 2016, respectively. Compared with less than 40% in 2013, High-income economies will contribute about half of global growth in 2015 and 2016. For developing countries, the acceleration in high-income economies will be an important impetus.
The financial health of economies has improved. With the exception of Russia and China, stock markets have done well in emerging economies, notably in India and Indonesia. A gradual tightening of fiscal policy and structural reforms are desirable to restore fiscal space depleted by the 2008 financial crisis.
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- Article
- February 18, 2015
Internal Revenue Service (IRS) published over 77,000 banks and other foreign financial institutions (FFIs) which already registered with the United States and received a global intermediary identification number (GIIN), to comply with the Foreign Account Tax Compliance Act (FATCA). FFI fails to disclose information on their US clients will result in a requirement to withhold 30% tax on payments of US-sourced income.
Necessary to obtaining a GIIN , as long as FFIs are making a good-faith effort to achieve compliance, such as completing their FATCA registration. FATCA will into force on July 1st 2014, but, with regard to its due diligence, reporting and withholding provisions, and so as to facilitate an orderly transition, the Internal Revenue Service is to refrain from rigorously enforcing many of its requirements in calendar years 2014 and 2015.
The first update posted by the IRS on July 1. The monthly posting of FFI list will contain the names of all FFIs that have completed FATCA registration with the IRS and obtained a GIIN up to 5 business days before the end of the previous month.
Refer FATCA regulations and other FATCA guidance for the rules concerning the need to identify and document account holders and payees; the need to withhold on withholdable payments (including transitional rules); and the requirement to report information to the IRS concerning accounts and payees – advised by FFI.
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- Article
- February 18, 2015
OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes has issued 12 new reports which assess jurisdictions’ legal and regulatory framework for information exchange and transparency. Due to these reviews, Saudi Arabia Columbia and Latvia meet the qualification standards of the next stage of the review process, while the peer review of the Federated States of Micronesia (FSM) determined that the jurisdiction doesn’t have in place a well structured legal framework for the effective exchange of information, and as such failed to qualify for a Phase Two review.
Malaysia and the Slovak were rated as “Largely Compliant” and Slovenia got a “Compliant” rating. Barbados got a “Partially Compliant” overall rating due to gaps in its networks of agreements to information exchange. Mauritius was identified as having implemented recommendations and maintained a collective “Largely Compliant” rating. The UAE and Botswana have been given rights to progress to the next stage of their respective reviews following their implementation of substantial changes.
To focus on the implementation of the new standard for automatic exchange of information (AEOI) – the Common Reporting Standard released by the OECD in February 2014. The Global Forum currently reviewing its Terms of Reference for assessing jurisdictions in advance of a new set of reviews commencing in 2016.
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- Article
- February 18, 2015
Amendments to the laws governing the Dubai International Financial Centre (DIFC), a free zone in Dubai recently announced by Mohammed bin Rashid Al Maktoum, the Vice President of the United Arab Emirates and ruler of Dubai.
The amendments include the establishment of a disputes settlement authority and the new authority will be an independent corporate body that will carry out its duties without the intervention of any DIFC authorities. It will be headed by the chairman of the Centre’s Courts.
Disputes settlement authority will comprise three bodies: the DIFC Courts, an arbitration body, and “any other subsidiary committees or institutions established under the laws and regulations of the DIFC.”
The UAE’s Vision 2021 invites for the implementation of an effective and sophisticated disputes settlement regime as part of a strategy to make the country a top global business center.
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- Article
- February 18, 2015
According to the Institute of International Finance (IIF) solid fundamentals and non-oil sectors drive GDP growth. The UAE economy grew 4.7% in 2013, supported by higher oil production. This growth trend is forecast to continue into 2014 supported by strong non-hydrocarbon growth.
The IIF economists have forecast a non-oil sector growth of 5.2% while the overall UAE economic growth is expected to moderate to 4.2% this year due to a decline in oil revenues, While Dubai’s GDP is expected to grow in excess of 5%, Abu Dhabi’s economy is projected to grow 3.6% this year.
Strong non-oil sector growth indicates by leading financial indicators such as real estate prices, equity market valuations, business confidence index and the evolution of credit default swaps (CDS). Dubai’s sovereign CDS spreads declined from 226 basis points (bps) in 2012 to 181 at the close of the first quarter of this year indicating improved market confidence in government debt and creditworthiness of Government Related Entities (GREs).
The IIF has cautioned Dubai against further build-up in public debt. While Dubai’s $20 billion debt refinancing agreement with the Central Bank of the UAE and the Government of Abu Dhabi has eased the debt servicing burden.
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- Article
- February 18, 2015
OECD (Organization Economic Co-operation and Development) has been endorsed the Declaration on Automatic Exchange of Information in Tax Matters with all 34 Organization of member countries, along with Argentina, Brazil, China, Colombia, Costa Rica, India, Indonesia, Latvia, Lithuania, Malaysia,Saudi Arabia, Singapore and South Africa.
The declaration commits the signatories to implement a new single global standard on automatic exchange of information. The OECD lay out its plans for a new global ‘common standard of reporting’ for the automatic exchange of tax information among countries earlier this year. To report information to authorities in their own jurisdictions, the common reporting standard will need financial institutions and brokers and this information will in turn be passed on to other relevant countries automatically. The OECD and the G20 group of leading global economies was developed the standard
The OECD will deliver a detailed Commentary on the new standard, as well as technical solutions to implement the actual information exchanges, during a meeting of G20 finance ministers in September 2014.
G20 governments have regulated the OECD-hosted Global Forum on Transparency and Exchange of Information for Tax Purposes to monitor and review implementation of the standard.
OECD said “More than 60 countries and jurisdictions have now dedicated to early adoption of the standard, and additional Global Forum members are expected to join this group in the coming months”
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- Article
- February 18, 2015
A senior government official at the Dubai immigration department said “The UAE is considering issuing a separate visa for businessmen”.UAE’s Ministry of Interior considered the ‘Golden Visa’ at the federal level.
Major-General Mohammed Ahmed Al Marri, Director-General of the General Directorate of Residency and Foreigners Affairs (GDRFA) – Dubai, stated “The Ministry of Interior is studying the proposal to issue ‘Golden Visa’ for businessmen and we are looking to implement it at the federal level… the future will be different and things are subject to changes and modification to obtain visitors satisfaction.”Al Marri didn’t reveal other details such as the duration and costs of the ‘Golden Visa’.
The ‘Golden Visa’ boosts investor emotions and draws foreign investments in the countries. The issuance of ‘Golden Visa’ in UAE will also meet the much-awaited demand of the local business community to have a longer-term visa to boost the FDI.
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- Article
- February 18, 2015
Dubai Investments International, an investment firm listed on the Dubai Financial Market, a wholly owned subsidiary of Dubai Investments, is looking at worldwide expansion, especially into Asia and Africa. In addition to joint ventures and strategic partnerships across Africa and Asia, the company is also seeking commercial projects in some Middle Eastern countries, Dubai Investments announced in a statement.
Dubai Investments International is also in advanced stages of negotiations with prospective business partners in Libya and Erbil in Kurdistan, Iraq to create an industrial, commercial and residential business park similar to Dubai Investments Park and duplicating the business model in the respective countries
Further, DI International is working deeply with relevant government authorities to attract investments as also international firms to set up industrial units within these business parks.
Khalid Bin Kalban, Managing Director and CEO of Dubai Investments, said: “The setting up of Dubai Investments International was the first step in our strategy to expand our global footprint in key markets.
“Our plans are in place and we are in advanced negotiations with leading strategic players on investment opportunities across diversified sectors in the existing and new geographical locations across the globe to consolidate our position as an important international player. We are now in the process of setting up agencies and representative offices across strategic markets.”
He also added “We will use our expertise, business plans, and networking tools to build similar facilities in other locations too,”
>DI’s exports have surged over 129 per cent over the last five years, and the DI International’s growth plans will further leverage its global footprint in a big way. The company is focusing investments in existing and new businesses in international markets, with particular focus on Gulf, Middle East and Africa
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- Article
- February 18, 2015
- Switzerland – Argentina: New Tax Treaty Signed
- Jordan, Sudan sign 19 agreements
- Luxembourg and United States Sign FATCA Agreement
- Singapore – Sri Lanka: Tax Treaty Signed
- Malta – Moldova: Tax Treaty Signed
- Guernsey – Monaco: Tax Treaty Signed
- Hong Kong – Qatar: Provisions of Tax Treaty Become Effective
- Cayman Islands – Seychelles: Tax Information Exchange Agreement Signed
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