Cyprus has announced a savage increase in the annual tax levied on real estate. Although the rates of tax will not change, the valuation basis will be updated. Properties valued up to EUR170, 860 are exempted; values from EUR170, 860 to EUR427, 150 are charged 2.5%; values from EUR427, 150 to EUR854, 301 are charged at 3.5%; higher values pay 4%. Few people pay significant amounts of tax at present; if current valuations were to apply, many house owners would be hit hard. (Source: Investors Offshore.com)

The Hungarian Constitutional Court nullified a controversial real estate tax law citing a violation of legal security. The decision deprives the central budget of 50 billion forints inflow in 2010. The Court's objections were to the way the law determined real estate values. Taxpayers were required to determine the market value of their properties on their own and declare it to the tax authority. However, market value is very relative, and that assessments can fluctuate by as much as 30-40 percent. The high court left the portion of the law taxing boats, aircraft and cars unchanged. (Source: Xinhua)

BVI turns its attention to helping its more than 60,000 new companies per year build a business environment where innovation can be a key economic driver. BVI announced the establishment of a Focus Group to review and revise the existing IP laws. The establishment is with a view to "making recommendations for legislative revision that are in concert with recent developments in the field and industry." The Focus Group is expected to be inaugurated in February and complete its work by 31 December 2010. (Source: Mondaq.com)

The China Banking Regulatory Commission has banned banks from selling loans to trust companies, removing a vehicle used by banks for temporarily removing loans from their balance sheets. The practice of selling loans temporarily to trust companies with promises to buy them back any time between a few weeks and a few years later had allowed banks to report lower loan totals, but ratings agency Fitch noted in a report that it was unclear whether doing so actually reduced banks' exposure to the loans. (Source: China Economic Review)

Bank of America Merrill Lynch is helping more than a dozen big international hedge funds set up or re-enter Hong Kong and Singapore, tempted by a perceived more liberal environment to regulation than in the US and Europe. The comments also throw light on how the broader wealth management sector is looking at the most favourable places in which to do business in the near to medium term, with Asia frequently coming top of the list in terms of attractiveness from a tax and regulation point of view. (Source: WealthBriefing)

Family solicitors have reported a rise in the number of clients asking for prenuptial agreements to be prepared using the collaborative law model. The collaborative approach in general aims to resolve family disputes without going to court, through a series of face-to-face meetings between the parties and their lawyers. Collaborative agreements are more likely to be upheld in court, because it would be harder for one party to say that they had no choice about entering the agreement where they have attended several joint sessions and actively participated in the discussions. (Source: The Law Gazette)

Recipients of inheritances and gifts face higher tax bills. Revenue’s thresholds for capital acquisitions tax will be cut by 4.5 per cent for inheritances or gifts received in 2010. The changes mean that inheritances bequeathed by a parent to his or her child will be tax-free only up to €414,799, down €19,300 from the previous threshold. The gifts and inheritances between brothers and sisters or from uncles and aunts to nephews will now be taxable above €41,481, down from €43,400 previously and €54,254 before last April. The limit for other relationships falls to €20,740 from a previous level of €21,700. (Source: Sunday Business Post)

The number of cases launched by people unhappy about their inheritance increased 86 per cent in a year, says City law firm Wedlake Bell. High Court statistics show that claims relating to the provision for dependents soared from 43 in 2007 to 80 in 2008. Many disputes arise when a person dies without a will, leaving their estate to be distributed not according to their wishes but under intestacy rules. In these cases, many relatives are forced to apply to the courts for a portion of the estate. (Source: The Independent)

China begins levying from Jan.1 a 20-percent personal income tax on founding individual investors who make a profit from selling their locked-up shares as it seeks to promote a healthy development of its capital industry. The move is also to adjust the taxation arrangement for wealthy people. But individual investors who profit from selling their publicly-traded stocks will continue to be exempt from having to pay personal income tax as part of efforts to boost trading. (Source: Shanghai Daily)

Malaysia has relaxed the real property capital gains tax, to include only properties sold within five years of purchase. The tax is effective from January 1, 2010. A 5% fixed rate tax was introduced on capital gains from all disposals of real property, with an exemption of USD2,900 or 10% of the gains, whichever is the higher, given to individuals. Intra-family transfers and once-in-a-lifetime sales of residential property by a Malaysian citizen will also be exempt from the tax. However, the tax did not differentiate sufficiently between speculators and longer-term homeowners. (Source: Tax-News.com)

Qatar, in an attempt to attract foreign investment to the region, slash the tax rate applied to foreign companies to a flat rate of 10%, effective from early 2010. Qatar currently has seven corporate tax strata, ranging from 0% for companies with annual incomes of QR100,000 (USD137,000) to 35% for companies generating in excess of QR5 million. Competition to attract foreign investment is rife in the Gulf region. Qatar faces stiff competition from the United Arab Emirates and Bahrain where 0% corporate tax rates operate. (Source: Offshore Investment)

In Jersey more than two-thirds of all deposits are non-sterling denominated. Many private clients have business-related currency needs that span borders. Furthermore, high net-worth individuals are increasingly mobile and have assets in more than one location. Currency accounts can be used to benefit from a higher interest rate on one currency than you might get elsewhere. However, with currency accounts you also have the benefit to win or lose on the fluctuations depending on how strong each currency is at a particular time. (Source: Telegraph.co.uk)

China had approved the launch of index futures and given it the green light to pilot the margin trading business. The regulator would select the first batch of securities companies for the margin trading business, based on their net capital, risk control and regulatory management. Margin trading allows securities companies to lend stocks and money to investors. The authority would prepare a series of standards which investors would have to meet, an entry-permit for financial institutions, as well as guidelines for approving futures contracts and opening of investors' accounts. (Source: Xinhua)

According to KPMG, someone on £1m will pay £491,278 in tax and social security in 2010, following UK's tax rises which will take the top rate of income tax to 50pc. In Frankfurt the figure is £486,808 and Paris £461,128. New Yorkers with equivalent annual earnings of £1m will pay £432,770 in tax, while people who opt to leave London for Switzerland will see their tax bill fall to £418,186. That's a material sum and makes the threat of a gradual exodus from London real. KPMG's figures show that for the first time since 1989 UK's top rate of tax is now higher than both France and Germany. (Source: Telegraph.co.uk)

In order to further regulate the use and management of raised funds of ChiNext listed companies, the SZSE recently released the "Business Memorandum No. l for ChiNext Information Disclosure—Use of Over-raised Funds". The Memorandum emphasize that the over-raised funds shall be used for main business of listed companies, not for high-risk investment. Listed companies shall properly make plans for the use of over-raised funds in light of the company’s development planning and actual production and operation needs within 6 months after the aforementioned funds are collected.

Outsourcing firms in India and North America are now faced with increasing competition from new entrants. The outsourcing industry is transforming due to the emergence of new providers and efforts of existing outsourcers to expand into new markets. However, only 16 per cent of Indian service providers see competitors from other emerging economies as a threat. Moreover, unrealistic client expectations and the lack of an outsourcing strategy for them were top reasons for contract terminations. (Source: The Economic Times)

Ireland has announced the enactment of the Companies (Miscellaneous Provisions) Act 2009. The Act will allow certain companies to continue on a temporary basis to use US Generally Accepted Accounting Principles in the preparation of their accounts. The Act also introduces a mechanism to allow certain types of collective investment fund to migrate their activities into and out of Ireland without firstly having to wind up in their current jurisdictions. Most of the provisions will enter into force with immediate effect. (Source: Tax-News.com)

China became the world's largest merchandise exporter in 2009, toppling Germany's US$917 billion with a figure of US$957 billion in exports. During the downturn, China's exports of consumers goods remained comparatively strong, while Germany's high-end machinery and manufacturing equipment exports suffered the effects of a worldwide decline in investment spending. China's currency ties to the dollar also allowed its exports to gain market share and benefit from the depreciating US currency. (Source: China Economic Review)

EU finance ministers have agreed to mandate the "spontaneous" exchange of banking information between member states. They are mainly aimed at stopping fraudsters organising insolvencies in member states where they have debts. Existing international provisions to fight this process have only allowed a small proportion of debts to be recovered. But member states have not yet agreed on the extension of the EC Savings directive 2003/48/EC to cover trusts and other financial vehicles. (Source: STEP)

The Cayman Islands and other offshore money centers could become scapegoats unless regulation is stepped up on Wall Street's biggest banks to avert another potential financial crisis. Without effective regulation, nothing prevents the world's largest banks and other financial institutions from carrying on with the high-risk business practices. Faced with escalating budget deficits, a declining taxpayer base and bank bailouts, more governments will increase taxes. OECD and G20 countries will then keep up the pressure on offshore centers to make sure their citizens are not evading taxes. (Source: Reuters)

【Chief Editors: Cynthia & Lillian 】

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