Tax Talk
Global Developments

Indirect Tax

South African businesses liable to VAT on electronic services from foreign suppliers

Excerpts from various sources

Starting 1 April 2025, foreign traders providing electronic services exclusively to South African VAT registered businesses (B2B) are not required to charge VAT. Instead, the South African business customer will account for VAT under reverse charge mechanism. However, if the foreign supplier also sells to consumers (B2C), they must register and charge VAT on all supplies, including B2B services.

No e-invoicing mandate for registered nonestablished entities in Belgium

The Belgian authorities have officially confirmed that nonestablished entities registered for VAT in Belgium will be excluded from the scope of the country’s B2B e-invoicing mandate that will be effective from 1 January 2026.

Transfer Pricing

United States: Announcement and report concerning advance pricing agreement⁹

The Internal Revenue Service of United States of America released its 26th annual advance pricing agreement (APA) report which discusses experience, structure, and activities of the Advance Pricing and Mutual Agreement (APMA) program. The highlights of the report are as under:

• The total number of APA’s executed in 2024 was 142 (13 unilateral, 119 bilateral, and 10 multilateral) as against 169 applications that were filed. The number is lower as compared to 156 APA’s executed in 2023.
• The above chart signifies strong and robust relationship between competent authorities of India and USA
• In 2024, the percentage of APA renewals executed was 58% as compared to 47% in 2023
• More than half of the APAs executed in 2024 involved transactions between non-U.S. parents and U.S. subsidiaries
• Most of the transactions covered in APAs executed in 2024 involve the sale of tangible goods or the provision of services. 22% of the transactions involve use of intangible property, which can be among the most challenging transactions in APMA’s inventory
• In 2024, the most commonly used transfer pricing method (TPM) for both the sale of tangible property and the use of intangible property continued to be the comparable profits method/transactional net margin method. It was used for 78% of these types of transactions.
• The operating margin (OM) continued to be the most common profit level indicator (PLI) used to benchmark results. It was used in 72% of the cases.
• The median time required to complete an APA decreased in 2024 to 33.5 months (versus 42 months in 2023).

OECD Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports (CbC MCAA)

As part of global efforts to enhance tax transparency and combat base erosion and profit shifting (BEPS), numerous countries have been signing the CbC MCAA since 2024. This agreement facilitates the automatic exchange of CbC reports among tax authorities to ensure greater oversight of multinational enterprises. The recent signatories include:

The complete and updated list of signatories is available at the following link:

OECD CbC MCAA Signatories List (PDF)

Apart from the above USA has executed similar exchange agreements with various countries.

Group filing in any of the above notified jurisdiction is a sufficient compliance of CbC reports and other group entities may only need to notify of such filing in the relevant tax authorities of their respective countries. However, where no exchange treaty exists, local filing is required.