WEEKEND PREVIEW: Opportunity Zone Outlook and Fortune 500 HQ
This is a Bloomberg Tax Insights weekend summary, written by practitioners and featuring expert analysis on current issues in tax practice and policy. The articles featured here are just a handful of the many Insights published each week. For a complete archive of articles, browse by jurisdiction at Daily tax report, Daily Tax Report: State, Daily tax report: international, and Financial Accounting.
This week, we take a look at the outlook for the Opportunity Zones program in 2021, the EY World Headquarters study in 2020, the pitfalls of PPP loan cancellation, and more. We will hear:
- Libin zhang by Fried Frank on where the Opportunity Zones program could take next year
- Brandon pizzola, Robert carrol, and James mackie of Ernst & Young on the relocation of Fortune Global 500 companies
- Nicolas gutzmer from Smolin Lupine & Co. on the Potential Pitfalls of Paycheck Protection Program Loan Forgiveness Applications
- EY in the world tax leaders explain how Covid-19 transformed tax policy in Asia-Pacific
- Alain Viard from the American Enterprise Institute on Why the United States Needs a Value-Added Tax
- Shailendra Sharma on a court decision relating to permanent establishment in India
- Steve minhoo kim and Tom kwon by Lee & Ko on Transfer Pricing Trends in South Korea
- Paul falvey from BDO on operational changes made by the UK tax administration HMRC
The Opportunity Zones have generated a lot of excitement and apparently $ 75 billion in investment since they first appeared over three years ago in the bill that became the Tax Cuts and Jobs Act. Libin zhang by Fried Frank examines some of the issues that have affected opportunity funds and their investors in 2020, what the future may hold for the program under a Biden administration, and the diversity and inclusion issues that fund advisors at opportunity have in mind in 2021 and over the next 10 or 30 years. Read: Three years of 2021 opportunity and outlook zones
The headquarters of the world’s largest companies are moving away from the United States and major European countries. Bob Carroll, James mackie, and Brandon pizzola of Ernst & Young LLP analyzes the latest statistics from the Fortune Global 500. Read: The Changing Headquarters Landscape for Fortune Global 500 Companies
The paycheck protection program remains somewhat of an obstacle course for companies that have used the loans from the program to keep their businesses afloat and their employees paid. Nicolas gutzmer de Smolin describes the potential pitfalls of applying for a PPP loan cancellation and how to avoid them. Read: The Pitfalls of Pay Check Protection Program Forgiveness
Asia-Pacific was the first region to enter the Covid-19 pandemic. How did he navigate the “new normal”? As the closing of the EY Asia-Pacific Tax Symposium 2020 approaches, Kate Barton, EY’s Global Vice President of Taxation, and others EY’s tax officials share how the pandemic has transformed the political outlook in the region and highlight how taxation has played a key role in building a better working world. Read: How Covid-19 transformed tax policy in Asia-Pacific
The United States faces a large, long-term imbalance between planned federal tax revenues and federal spending, which widened during the coronavirus pandemic. Alain Viard of the American Enterprise Institute postulates that a value-added tax is a viable way to reduce the imbalance. Read: United States Needs Value Added Tax
Shailendra Sharma describes how a Mauritius-based shipping company owned by UAE resident shareholders engaged in shipping business in India does not constitute a permanent establishment in India under the India-Mauritius tax treaty. Read: Mumbai court ruling on permanent establishment under India-Mauritius tax treaty
Steve minhoo kim and Tom kwon de Lee & Ko discuss recent transfer pricing trends in the post-BEPS era, and how the South Korean government has tried to approach and keep pace with recent developments and practices in the OECD in the midst of an era of unprecedented global change internationally. tax scene. Read: South Korea — Transfer pricing trends
Paul falvey of BDO considers the operational changes that the UK tax administration HMRC has made to meet the challenges of the Covid-19 pandemic and that it should retain for the future. Read: Rethinking the Tax System: Better Rebuilding the UK Tax Administration
Discussion on corporate taxation with Ratul Narain, CEO of Bempu Health
Ratul Narain, Founder and CEO of Bempu Health, spoke to Bloomberg Tax about the impact of India’s historic indirect tax reform on the cash flow of its medical device startup. Bempu, based in Bangalore, India, is focused on providing wearable sensors to newborns and children at risk. She has delivered life-saving commodities to thousands of babies in countries in Africa, Asia and South America in partnership with governments and UNICEF. Read: Discussion on corporate taxation with Ratul Narain, CEO of Bempu Health
Bloomberg Tax contributors have kept us abreast of developments in the Opportunity Zones program and have quickly identified what will work and what will not work within the proposed directions and regulations.
A business created to buy and lease newly constructed condominiums could generate qualifying benefits from the opportunity fund. Alain lederman by Gunster, Yoakley & Stewart PA reviewed the pre-opportunity zone guidelines and case law to explain how.
The Opportunity Zones guidance continues to give investors and their advisers a clearer picture of how the program works while making it more achievable, but questions remain, wrote Billy Morrow by BDO.
The Treasury and IRS recently released corrective amendments to the final Zone of Opportunity regulations, and those amendments came with an unexpected giveaway. Lisa Starczewski by Buchanan Ingersoll & Rooney stated that the correcting the changes appears to make it easier for an entity to meet the skilled professional qualifications of the area of opportunity during the start-up period if it has a safe harbor for its working capital.
What is happening outside of the tax world?
Several United States Supreme Court justices indicated in oral argument that the court may be leaning towards preserving key elements of the Affordable Care Act. While the judges’ comments don’t always portend the court’s final decision, a sudden disruption of the ACA now seems less likely. Foley Hoag LLP administrative law practitioners Tad Heuer and Andrew M. London suggest three clues to legal and political movements that could shape the future of ACA. Read: Watch these clues to assess if ACA survives the U.S. Supreme Court
Non-disclosure agreements serve an important purpose, but now is the time to get them under control, writes Gerald Sauer, founding partner of Sauer & Wagner LLP in Los Angeles. When worded too broadly, nondisclosure agreements can hurt those who sign them and can even break laws or be unconstitutional, he says. Read: The nondisclosure agreement: time to reorganize?
Covid-19 has impacted the M&A industry, but activity is slowly returning to normal levels. Steve murphy, CEO of Epicor, explains how to close deals without face-to-face interaction, key changes in the legal and regulatory aspects of the M&A process, and the benefits of Special Purpose Acquisition Companies (SPACs) for those who take the route of the IPO. Read: Flexibility is a must in mergers and acquisitions during Covid-19
Tyrone P. Thomas, Chairman of Mintz’s Diversity Committee, examines some of the myths and realities of President Trump’s executive order addressing race and gender references in diversity and inclusion trainings by federal entrepreneurs and federally funded entities . Read: Myths and facts about Trump’s race and gender decree
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Gary Sprague by Baker & McKenzie compares source of income and eligibility to foreign-source intangible income (FDII) for software and digital content shipments. The author concludes that the final FDII regulations and the rules on revenue sources do not produce parallel results in many cases.
Bloomberg Tax Insights articles are written by seasoned practitioners, academics, and policy experts who discuss current tax developments and issues. To contribute, please contact Erin McManus at [email protected].