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David Cuellar

Jelena Zivkovic The Montenegrin Law on Personal Income Tax defines income subject to personal income tax to include salaries, income related to immovable property and immovable property rights, income related to capital as well as capital gains. All of these types of income are taxed at the rate of 9%. From a corporate perspective, of interest to companies are certain cases such as severance payments which have a specific tax treatment.

Emanuel Bancila In recent years Romanian taxpayers had to deal with significant delays in refund of the excess input VAT. As a result, the European Commission started the administrative preliminary phase of the infringement proceedings against Romania. Currently, the majority of Romanian tax inspection task force is assigned for tax audits and requests related with the refund of the excess VAT. In addition, a recent ruling of the European Court of Justice (ECJ) stated that the administrative measures taken by the tax authorities during a tax audit concerning a VAT refund cannot preclude a taxpayer from obtaining default interest on a late refund by the tax authorities. Therefore, it appears that now the time has come for the Romanian tax authorities to pay the bill for all those delays in refunding the excess input VAT – specifically by paying default interest to the amounts in question. The VAT Directive provides that in case the amount of deduction exceeds the amount of payable VAT, the member states may either make a refund or carry forward the excess to the following period. Romania opted for a refund of the excess input VAT. Moreover, the member states have the freedom to set out the conditions based on which the refund procedure is performed, however with the observance of the applicable VAT European principles.

Peter Dachs The Tax Administration Act provides that a taxpayer is liable to pay tax once an assessment has been raised by the South African Revenue Service (SARS). In terms of section 164 of the Tax Administration Act, unless a senior SARS official otherwise directs in terms of subsection (3), the obligation to pay tax and the right of SARS to receive and recover tax will not be suspended by an objection or appeal or pending the decision of a court of law. In terms of section 164(2) a taxpayer may request a senior SARS official to suspend the payment of tax or a portion thereof due under an assessment if the taxpayer intends to dispute or disputes the liability to pay that tax.

Filip Babic According to the new bylaw on interest rates considered to be adhering to the arm's-length principle (published in the Official Gazette RS 17/2014), new interest rates have been prescribed with regards to related party financing transactions. These rates will be used to calculate interest income and interest expense arising from loans provided to or from related parties. The proposed rates are applicable to loans in RSD (Serbian dinar) and loans indexed in foreign currencies such as EUR, USD and CHF.

Jackie Hess

Daniel Armesto

President Obama recently released his annual Budget recommendations for fiscal year 2015.

Palaniappan Chidambaram, India’s finance minister, said this week that the Direct Taxes Code (DTC) and goods and service tax (GST) Bills will not be passed in the current Parliamentary session, despite telling International Tax Review in December that he was hopeful of passing the heavily-delayed DTC Bill in the winter session.

A lap-dancing club called Sugar & Spice, based in Norwich in the UK, has lost its dispute with HM Revenue & Customs (HMRC) over whether the hiring of private booths qualifies for a VAT exemption. The club claimed that cash generated from its supply of booths – used by dancers for private performances – should not have a VAT charge attached to it. The club provides an "exempt supply of land" for an agreed time period, it argued.