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ASEAN Tax and Regulatory Update

By Dezan Shira & Associates
Posted: 24th November 2014 09:03
In this article we highlight some of the recent tax and regulatory actions taken in the ASEAN region. For further insight into any of these topics or for any other queries, please contact Dezan Shira & Associates.
The importance of ASEAN continues to grow, with 2015 set to see the implementation of the ASEAN Economic Community (AEC). The AEC seeks to “transform ASEAN into a single market and production base, a highly competitive economic region, a region of equitable economic development, and a region fully integrated into the global economy.” Collectively, ASEAN represents a market of some 600 million people, with a combined GDP of about US$2.5 trillion and upwards of US$1.5 trillion in trade flowing throughout the region.
ASEAN to Create Effective Dispute Settlement Mechanisms
During a recent meeting focused on ASEAN Dispute Settlement Mechanisms (DSM) held in Siem Reap, Cambodia, ASEAN strongly affirmed that they were committed to establishing dispute settlement mechanisms in all fields of cooperation.
Further reinforcing this idea, Deputy Secretary-General of ASEAN for Community and Corporate Affairs, H.E. AKP Mochtan stated at the meeting: “DSM is a key component in the realization of a rules-based community, where the rule of law is strengthened and disputes are resolved through peaceful means with legal certainty and predictability.”
In recent times, ASEAN has taken a number of serious steps towards strengthening its DSM, these measures have included:
 - The successful conclusion of the Protocol to the ASEAN Charter on Dispute Settlement Mechanism in 2010
 - The Treaty of Amity and Cooperation in Southeast Asia
 - The Protocol on Enhanced Dispute Settlement Mechanism (EDSM)
Singapore and the United Arab Emirates Sign Double Taxation Agreement
On October 31, 2014, the Inland Revenue Authority of Singapore (IRAS) announced that Singapore and the United Arab Emirates (UAE) signed a protocol amending the Singapore-UAE Double Taxation Agreement (DTA). Key terms that have been revised include:
 - A threshold period of 12 months (instead of nine months) to ascertain the presence of a permanent establishment (PE)
 - Reduced withholding tax rates for dividends and interest income
 - A new Exchange of Information article (Article 26)
RELATED: EU-Singapore Finalize Free Trade Agreement
Malaysia Updates Guide on Goods and Services Tax (GST) for the Insurance and Takaful Industry
The Royal Malaysian Customs has updated its Guide on GST for the Insurance and Takaful Industry. Takaful is a type of Islamic insurance. The main takeaway from the guide is that:
 - General insurance or general takaful products will be treated as taxable supplies with a standard GST rate of six percent
 - The treatment on general reinsurance and general retakaful will also be standard rated
This article was first published on ASEAN Briefing.
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam as well as liaison offices in Italy and the United States.
For further details or to contact the firm, please email or visit

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