Greetings and Happy Tuesday! This is Tax Roast, a weekly newsletter that brings you the latest updates and insights from the international tax world from tax experts (and coffee enthusiasts) who are walking the tax advisory path.

And do not forget to check out our coffee of the week, because there is no tax news without a good cup of coffee :)

International Tax Update

United States / International boycott list

The US Treasury Department has reissued its list of countries that require cooperation with or participation in an international boycott as a condition of doing business. Taxpayers are required to file reports concerning business operations in the listed countries. The list can be accessed HERE.

Greece / Pillar 2 legislation submitted for public consultation

Greece has submitted a draft bill implementing Pillar 2 for public consultation. The consultation runs until 6 March 2024. The draft bill is closely aligned with the EU Directive. In addition, Greece has opted for a qualifying domestic top-up tax.

wane to stay up to date with the latest Pillar 2 developments. In our view this TRACKER is a good starting point.

Brazil / Dutch court classifies INE as interest

A Dutch district court (Case 23/1352) recently issued a ruling on tone classification of Interest on Net Equity (INE) under the tax treaty concluded between Brazil and the Netherlands. In the specific case at hand the court concluded that INE shall be considered as interest income as opposed to dividend. This decision interestingly is in contrast to prior decisions.

Indonesia / Accession talks started with OECD

On 20 February 2024 the OECD announced the start of accession talks with Indonesia. Until now, Indonesia has been a key partner of the OECD without being a member. The official release and information on next steps can be read HERE.

Fun Tax Fact of the Week

Global minimum tax / Pillar 2 bootcamp

This week we cover another entity classification that is important for Pillar 2 besides UPE, IPE and POPE. So let’s see which entities should fall under the definition of Minority Owned Constituent Entity.

Minority Owned Constituent Entity (MOCE) is an entity which is a constituent entity in which the UPE has a direct or indirect ownership interest of 30% or less. MOCEs are subject to special treatment under the GloBE Rules. Although they are Constituent Entities, they are separated from the other Constituent Entities in the jurisdiction and their ETR and Top-up Tax is computed separately. This separate ETR and Top-up computation will often produce a different outcome than would a blended computation, i.e. a single computation based on the income and covered taxes of all Constituent Entities in the jurisdiction). Thus, in order to be functionally equivalent, a QDMTT must determine a separate ETR and Top-up Tax amount for MOCEs.

The July Guidance specifies that the jurisdiction that limit the application of their QDMTT to MNE Groups where all the CEs located in the jurisdiction are 100% owned by the UPE or POPE for the entire fiscal year must similarly not apply their QDMTT to MOCEs located in the jurisdiction.

Therefore identifying the correct entity classification for each entity within the MNE Group is essential as it can have an impact on the overall ETR and top-up tax calculation.

Leadership principles for top managers at Big Multi Inc. 🏢

Rule #7 - Decision making

So you have been promoted, created a mission statement, polished your unique and delicate vision, renamed your department.... and now you are ready to make the next step. We are here to guide you in the journey.

As a top manager unfortunately you would need to make some decisions. But you already know the more decision you make, the bigger the chance that you will make a mistake… So, you need to learn the common tactics to avoid making a decision on your own and shift the responsibility to others while you seem to be in charge. Here are our tips:

• Form a working group or a committee whose members are so busy that you don’t need to meet them for a long time. Don’t forget, the later you can make a decision, the more chance you have that the situation will become obsolete.

• Order your employees to collect more information about the issue at hand. When they bring the details, repeat the same for at least two more times.

• Ask something highly complex from another manager (maybe from legal department of treasury) and then you can excuse yourself from making the decision until you receive the other manager’s input.

• The last resort of every top manager is to make short 1-3 words long comment on random parts of a long memo prepared by the team. Preferably make some typos in your comments, so the employees spend at least 2-3 days trying to figure out what you meant.

Tax Roast of the week

Invite the crew for a coffee☕

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Coffee corner

Today let’s talk about the different main methods used for coffee roasting, and how these methods have an impact on the taste, color, or acidity of our beloved drink.

There are three main coffee roasting methods that are commonly used in the industry. The first method is called the light roast aka Vienna roast, which involves roasting the coffee beans at a lower temperature for a shorter period of time. This results in a light brown color and a more acidic and fruity flavor profile. Light roasts are often preferred by those who enjoy a brighter and more complex cup of coffee.

The second method is known as the medium roast aka French roast, which involves roasting the beans at a slightly higher temperature for a longer period of time. This results in a medium brown color and a balanced flavor profile with a good combination of acidity and sweetness. Medium roasts are often considered the most versatile and are enjoyed by a wide range of coffee drinkers.

The third method is the dark roast aka Italian roast, which involves roasting the beans at a high temperature for a longer period of time. This results in a dark brown color and a bold and smoky flavor profile. Dark roasts have a lower acidity and are often preferred by those who enjoy a stronger and more robust cup of coffee.

Enjoy your morning coffee!

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DISCLAIMER: None of this is financial or tax advice. This newsletter is strictly educational and is not investment or tax advice or a solicitation to buy or sell any assets or to make any financial or tax decisions. Please be careful and do your own research.
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