Budgetary Updates 2013: Canada, Cuba, Belgium
Belgium Revises Important Provisions in Budget 2013
Belgium has revised major tax provisions in its 2013 Budget.
It will abolish the regime of onetime fiscal amnesty given to taxpayers with effect from January 1, 2014.
The penalty rate will also be increased to 15% from the previous 10% for any regularization done before
Effective 2013, a 0.4% tax will be levied on capital gains on the sale of shares by large and holding
companies. Further, for corporate tax purposes, the tax levied is not deductible.
Withholding tax on dividends will be a flat rate of 25% for all situations.
The withholding tax on interest has been increased to 25% from 21%.
However, for savings accounts having deposit of more than EUR 1,830 (to be indexed) and specific
government bonds (issued between November 24, 2011 and December 2, 2011), the withholding tax
remains at 15%.
Canada: 2012 Federal Budget Measures Adopted
The Canadian government has passed majority of the remaining 2012 federal budget provisions. Following are the
The newly passed Bill-45 is to be considered enacted for US GAAP purposes and substantially enacted for
1. International Financial Reporting Standards (IFRS), and
2. The Canadian Accounting Standards for Private Enterprises (ASPE).
The Bill changes the Scientific Research and Experimental Development (SR&ED) program as well as the
thin capitalization rules, introduces the foreign affiliate dumping regulations and also provides denial
limits for partnerships under “section 88 bump”.
Cuba Overhauls the Tax System
The Cuban government has, through its new tax code, revised the tax system effective from January 1, 2013. The
major provisions are summarized below:
19 new taxes have been introduced which include sales tax, environmental levies and social security
State-owned enterprises in Cuba, which account for nearly 90% of all businesses, will be levied a tax rate
of 35% on profits.
The newly introduced social security tax rate is 25%. However, it would be systematically decreased to 5%
over a period of five years.
Entities with five or less employees will be exempt from this tax.
The new tax code also plans to introduce many tax concessions to stimulate the growth of economic
activity as well as agriculture.
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