The credit crunch has dimmed the British passion for property ownership. Just 51 per cent of UK homeowners believe owning their own home is essential for a reasonable standard of living, down from 60 per cent in 2003. Attitudes towards property have changed particularly among people aged between 55 and 64, with 44 per cent considering homeownership very important for a decent standard of living, down from 61 per cent six years ago. (Source: The Scotsman)

China released a circular on home ownership transfer tax. Individuals transferring the ownership of their non-common houses which have been purchased for five years or more, or the ownership of their common houses which have been purchased for less than five years, only need to pay business tax on the balance between the selling price and the original purchase price. Individuals who have owned their common house for more than five years and are transferring the ownership will be exempt from business tax. The new taxes will take effect from January 1, 2010. (Source: China Briefing)

Hungary issued a decree tightening borrowing. The goal is to reduce the risks associated with foreign currency loans. The decree covers all natural entities who wish to borrow money in Hungary, and all lenders operating within Hungary. The limit is set in forints, and borrowing in other currencies will be set at 80 percent of that limit. Home mortgages will be limited to 75 percent of the assessed value of the home. Car loans are being capped at seven years and at no more than 75 percent of the value of the vehicle. The new limits will go into effect on March 1. (Source: Xinhua)

Companies and entrepreneurs will be able to take out pan-European patents on their products. The measures will bring about a single EU patent and establish a new patent court in the EU, simplifying the process of protecting technology rights and making litigation more accessible and predictable. It should also curtail the cost of taking out international patents. A patent designating only 13 EU member states is already 11 times more expensive than a US patent. (Source: Irish Times)

India sets a stage for a much simpler process for registration of trademarks. Under the new regime, a person seeking global trademark will now not need to apply for it in several countries incurring additional costs. Trademark registered in the country will be valid globally. It is in line with the provisions in the Madrid Protocol, which enables nationals of its member countries to obtain trademark registration within 18 months by filing a single application with one fee and one language in their country of origin. (Source: The Economic Times)

Canada has accepted that a trust is resident in the jurisdiction where the trustees reside and exercise their discretion. But the decision in Garron case contradicts this. In Garron, shares in a Canadian company were frozen into a Barbados trust, which then sold them for CAD450 million. The trustee claimed the deal was non-taxable because of the trust's Barbados residency, but the Canadian Revenue Agency (CRA) challenged this. The judge agreed with CRA. She said that the residency criterion for a trust should be the same as that for a corporation.

Venture capital trusts are set to become the retirement saving plan of choice for many high earners. VCTs offer upfront tax relief at 30% on up to £200,000 a year. This will be more than on pensions for those earning £180,000 or more, who will get only 20% tax relief from April 2011. Growth in a VCT is tax-free, as are any dividends. Income from pensions is taxed. To stop high earners boosting pensions, from this April those on more than £150,000 cannot boost pension contributions beyond their "regular" amount, or £20,000, whichever is higher. (Source: The Sunday Times)

Ireland passed legislation making it easier for funds in offshore locations to move to Dublin. Ireland administers more than 10,000 funds, around half of them already domiciled in the jurisdiction. The new legislation speeds up the process of redomiciliation by making it possible to transfer a fund from its original domicile to Ireland just by arranging the departure and then notifying the Irish registrar. Regulatory hurdles must still be passed, but the need to set up a new company is eliminated. (Source: Financial Times)

Foreign funds are expected to take overweight positions in the local equities markets next year as the Chinese economy picks up steam. The Chinese government decided to grant more licenses to foreign funds. Foreign funds are projected to obtain an absolute minimum investment quota next year of $5 billion, up from this year's estimated $3.3 billion. Foreign funds or QFIIs are currently the only vehicle for foreigners to invest in Chinese equities under the A share category. (Source: China Daily)

The proposed European Commission regulation on cross-border succession supplies a mechanism for determining which state's succession law will apply when a citizen of one jurisdiction dies in another. The issues of forced heirship and "clawback" were the sticking points. Clawback laws allow assets gifted away by the parents during life to be taken back from the recipients and handed to the rightful heirs. This means a British home that was once owned by someone with relatives in another EU country could in some circumstances be confiscated by order of a court in that country. (Source: STEP)

Switzerland will cooperate more on international tax matters but wants a solution to regularise undeclared bank accounts in return. But protection of client privacy remained a key goal and it continued to reject the automatic exchange of information. Switzerland may consider the introduction of a final withholding tax, a services agreement with the EU, as well as other measures that promote fiscal honesty among bank clients. Swiss banks manage some $2 trillion in offshore money, making the country the largest offshore centre in the world. A large portion of that money is undeclared. (Source: Reuters)

China would temporarily charge low import tariffs for more than 600 commodities. The scope will include natural resource products, key components for optic communications, public health products, consumer products and advanced machines. High export tariffs will still apply to energy-intensive and resource products. The government will also lower import tariffs on six commodities, including fresh strawberries, as part of its commitments to the WTO. The general tariff level would be left unchanged at 9.8 percent next year. (Source: China Briefing)

A new law granting Chilean tax authorities access to all bank information was published. It is applicable as of 1 January 2010. The new law enables Chile's existing treaties to be considered to meet the OECD standard for exchange of information in tax matters. Chile is negotiating to become members of the OECD. Compliance with the internationally agreed tax standard for exchange of information had been a key element in its accession negotiations.

Canadian tax authorities say investment advisers at a branch of RBC Dominion Securities Inc. helped clients set up 16 accounts in Liechtenstein to evade taxes. RBC Dominion was requested to provide a detailed list of all accounts held in Liechtenstein from 1999 to 2008. RBC Dominion Securities said it never instructed investment advisers to set up entities in Liechtenstein. Thirteen Canadians who held offshore entities with LGT Group in Liechtenstein have either voluntary admitted evading taxes or are being audited by the tax agency. (Source: Bloomberg)

Ireland will impose a 200,000 euro "domicile levy" on those earning more than 1 million euros in income world-wide, and who have capital located here of over 5 million euros. This levy will apply to all those Irish nationals and domiciled individuals who qualify "regardless of where they are tax resident." The government chose to leave Ireland's attractive 12.5% corporate-tax rate unchanged. It also cut excise duties on alcohol and lowered the VAT to 21% from 21.5%. (Source: Wealth Bulletin)

China has further tightened rules governing cross-border money transfers by individuals in its latest effort to cut out inflows of speculative capital, or "hot money". The new measures limit the number of bank accounts owned by any one person that can be used in certain foreign-exchange transactions. The move doesn't relate directly to the domestic currency's exchange rate but closes a loophole in the system. (Source: China Economic Review)

HSBC Holdings Plc, Royal Bank of Scotland Group Plc and six other U.K. lenders won't face a further challenge to overdraft fees after a court ruling forced Office of Fair Trading (OFT) to drop its investigation. The decision upheld the fees, reversing two earlier rulings that said charges are subject to contract laws. Banks earn about a third of their retail revenue from overdraft charges. Profits are under pressure as banks face increased competition for customer accounts to fund lending after wholesale credit markets seized last year. (Source: Bloomberg)

Macau and the Mainland sign a supplementary memorandum promoting the RMB settlement business for cross-border trade. The changes will increase the quota on the value of RMB exchange for each individual each time from RMB 6,000 to RMB 20,000 equivalent; extend designated merchants who are allowed to exchange RMB for Pataca. The memorandum will also allow Macao residents to use RMB cheques to pay for consumer spending in the Guangdong Province up to RMB 50,000 per account per day. (Source: MacauNews)

Hong Kong is on course to become the world's leading market for initial public offerings (IPOs) this year, leaving Shanghai in second place. The bourse had raised about US$23 billion as of the end of November. Hong Kong had raised US$13.83 billion from IPOs as of the end of October, edging ahead of Shanghai on US$12.37 billion, according to the World Federation of Exchanges. Brazil was third with US$11.57 billion and New York fourth with US$11.3 billion. (Source: China Economic Review)

China's top legislature approved the Tort Law after four readings since 2002. The law covers liabilities for a range of circumstances, including traffic accidents, medical accidents, work-related injuries, pollution, harm caused by other people's pets and mental distress. It also covers infringements of personal rights, such as name, reputation, portrait and privacy. The law has equal importance with the Property Law. It takes effect next July. (Source: Xinhua)

Companies incorporated in the BVI have been approved to list on the Hong Kong Stock Exchange (HKSE). Listing in Hong Kong will provide BVI companies with an exit strategy which has not yet been available without first undertaking a significant restructuring. BVI companies are also able to list in several major exchanges worldwide, including NASDAQ and NYSE in the United States, AIM in London and SGX in Singapore. (Source: bviplatinum.com)

China announced a regulation to standardize and encourage the establishment of joint venture enterprises by overseas investors. The regulation will take effect from March next year. The regulation defines those joint venture enterprises as those set up by more than two overseas investors or by an overseas investor and a Chinese investor. The regulation covers both enterprise and individual investors. It also applies to investors from the Hong Kong, Macao and Taiwan. But it is not fully applied to investment-oriented partnership. (Source: Xinhua)

Google did not pay any tax on its £1.6 billion advertising revenues in Britain last year. It diverted all its advertising earnings from customers in Britain to its Irish subsidiary. The arrangement allowed Google legally to avoid paying more than £450m in corporation tax in 2008. Any British individual or company who places an advertisement with Google pays a fee to its European headquarters in Ireland, where corporation tax is levied at between 10% and 25%. (Source: The Sunday Times)

US approved punitive tariffs of up to 35 percent on all car and light truck tires from China in September. China denounced the measure as "a wrong practice abusing trade remedies." It filed a complaint with the WTO. Despite the Chinese efforts, the WTO was not able to establish a panel on the dispute on December because of an objection from the US. According to related procedures, China has to make a second request at the next DSB meeting, which is scheduled for January. Once established, the panel will need at least half a year to issue its final ruling. (Source: China Daily)

Small businesses will have to change the way they carry out business in the new year. The new Companies Act provides for a 12-year period for phasing out the Close Corporation Act. The closing of the door is expected to cut the tail off close corporations but there is a healthy body of close corporations that could become the envy of other small business owners. The new act also provides for the formation of two types of companies, profit and non-profit. (Source: allAfrica.com)

【Chief Editors: Cynthia & Lillian 】

Advertisement