[World Tax News] UAE Enables Taxpayers to Submit Registration Requests at 23 Government Service Centres and More

Editorial Team – [2024] 160 taxmann.com 753 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week.

1. UAE enables taxpayers to submit registration requests at 23 Government service centres

The Federal Tax Authority (FTA) has made the service to submit Corporate Tax registration requests available through 23 Government Service Centres located across the UAE.

The FTA explained in a press statement that enabling taxpayers to submit corporate tax registration requests through Government Service Centres allows them to register directly via the “Emara Tax” platform – a digital tax service that operates 24/7. In addition, taxpayers can also seek assistance from accredited tax agents listed on the FTA’s official website. The FTA said that the new initiative is part of expanding its service channels to encourage tax compliance by providing an environment that facilitates access to services. It allows taxpayers to submit a request for Corporate Tax registration with assistance from experts in Government Service Centres, which offer electronic services that meet government standards. These centres are managed by trained and qualified staff to ensure quality service delivery.

Once application procedures are completed and the accuracy of the data entered electronically at the service centre is verified, the FTA experts review the application internally, and the applicant receives their Tax Registration Number (TRN) via the email listed in the application they have submitted for corporate tax registration.

The FTA signed cooperation agreements to accredit several government service centres. Users can browse the list of accredited centres that are authorized to offer Corporate Tax registration request services on the FTA’s official website at: https://tax.gov.ae/en/tax.support/tasheel.centers.aspx

Source: News by Federal Tax Authority

2. US introduces bipartisan legislation to eliminate tax breaks for corporate consolidation

U.S. Senators Sheldon Whitehouse (D-RI) and JD Vance (R-OH) introduced the Stop Subsidizing Giant Mergers Act, legislation to end tax-free mergers and taxpayer subsidies for acquisitions that consolidate corporate power.

When one corporation is sold to or merges with another, the acquiring firm typically pays tax on the appreciated gain of stocks and/or assets the target firm holds. However, the arcane tax code contains a major exception for certain types of mergers. If a corporate reorganization is structured so that the acquiring firm is exchanging stock, then the appreciation in the value of the target firm’s stock and/or assets may be fully tax-exempt. In other words, neither the corporation nor its shareholders may owe tax on the appreciation in value at the time of sale. While the tax is deferred rather than forgiven, the corporation and its shareholders may escape tax forever.

This tax-free structure is a popular way for giant corporations to skirt tax responsibilities.

The Stop Subsidizing Giant Mergers Act would end this tax-free treatment for corporate mergers and acquisitions involving firms with combined average annual gross receipts exceeding $500 million during the prior three years. The legislation makes exceptions for mergers involving a small business, and corporations undergoing a purely internal reorganization would still be able to do so without incurring a tax obligation.

Source: Press Release, dated 21-03-2024

Bill to end the tax-free treatment of certain corporate reorganizations that involve large corporations

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