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In an attempt to limit abuse of tax treaty benefits, the Indonesian tax authority included an unusual and complicated definition of the term beneficial owner in article 26 paragraph (1a) of the recently amended income tax law (law number 36 of 2008). The new law took effect as of January 1 2009.

Rajendra Nayak Ganesh Pai A recent ruling of the Bombay High Court (HC) in the case of E*Trade Maur-itius Limited (2009-TIOL-166-HC-MUM-IT) held that the amount deposited by the purchasing company with the HC earlier, be released in favour of the Indian Tax Authority to pay the withholding tax liability. This liability related to a transaction involving a transfer of shares of an Indian company by a Mauritius tax resident company (taxpayer) to the purchasing company. The taxpayer was a company incorporated in Mauritius and was granted a tax residency certificate by the Mauritius tax authorities. The taxpayer sold its existing stake in an Indian listed company which resulted in capital gains to the taxpayer. Under article 13(4) of the treaty, gains derived by a resident of Mauritius from the sale of shares of an Indian company are exempt from tax in India. Further, the Supreme Court of India in the case of UOI vs. Azadi Bachao Andolan (263 ITR 706) earlier upheld that a tax residency certificate issued by the Mauritian tax authorities would be sufficient proof for a Mauritius company to be regarded as a resident of Mauritius and claim the benefits of the treaty. The same has also been clarified by an administrative circular.

Janne Juusela To prevent international evasion of taxes and harmful tax competition, Finland has, with the other Nordic countries, prepared and concluded treaties with certain offshore financial centres concerning the exchange of information on tax related matters. The treaties are part of the tax haven project, set out by the Nordic Council of Ministers, which follows the work of the OECD against harmful tax competition.

Though companies continue to feel the strain of the downturn, the top 10 tax directors in Europe tell Joanna Faith that the recession is not the only issue keeping in-house tax departments busy

Roberto del Toro Adriana Rodríguez On February 19 2009 in Cape Town, the Mexican and South African governments signed a tax treaty. These negotiations are part of the recent growth of the Mexican tax treaty network.

Following the G20 meeting and communiqué, the OECD Secretariat has issued a progress report on the jurisdictions that have implemented the internationally agreed tax standard. Mauritius is classified among the 40 jurisdictions that have substantially implemented these and is not treated as a tax haven.

KPMG in the US has appointed Chris Housman as partner in the firm's international corporate services group.

Paolo Giacometti In late 2007 the Italian budget law for 2008 introduced certain general provisions aimed at harmonising the rules set forth by the Italian income tax code for the determination of taxable income with the IAS/IFRS accounting rules. The general rules were to be integrated by additional regulations; at last, such regulations have been implemented by ministerial decree dated April 1 2009 (the Decree), which is still to be published in the Italian Official Gazette.

Australian cement firm James Hardie is seeking shareholder approval to move its corporate domicile from the Netherlands to Ireland for tax reasons.

By Joanna Faith