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Fat tax introduced by Samoa Airlines

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Have you ever wondered if  that fat person sitting in the aircraft has possibly  left you with less luggage allowance.

Well Samoa airlines  have taken steps  so that everyone gets charged fairly. Samoa Air has become the world’s first pacific airline to introduce the ‘fat tax’, which will see overweight passengers paying more for their seats.

The Pacific island nations have some of the “world’s highest rates of obesity”, with Samoa usually included in the top ten countries for obesity levels.

The  airline’s chief executive Chris Langton, has said that the fee is the “fairest way of travelling” with the added benefits  to  promote health and obesity awareness to locals.

How the fat tax works

Passengers will be required to type their weight and the weight of their baggage into the online booking section of the airline’s website.samoa obesity and fat tax airline

Passengers will also be weighed on scales at the airport

The rates will then vary depending on the length of the trip and will see travellers paying $1 per kilogram on short haul flights to about $4.16 per kilogram on flights between Samoa and American Samoa.

The Samoa Air homepage reads "We at Samoa Air are keeping airfares fair, by charging our passengers only for what they weigh. You are the master of your Air’fair

According o Fiji times.com “The world’s first airline to charge passengers by their weight rather than per seat says the policy has helped to raise obesity awareness and improve public health”

Samoa Air flies from Samoa to American Samoa, North Tonga, Niue, North Cook Islands and French Polynesia. The airline does not fly large commercial aircraft, but rather small planes that are more susceptible to weight variances.

 

Do you find this Fair or just plain rude?

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Lifetime Learning Credit for 2012, 2013 – US

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It’s obvious that paying for school, either through a student loan or out of pocket, is going to be expensive for you or your family. There are actually two credits available for this year that can help you get some of that money back, rather than sending more money to the IRS.

student loan china Hecs Help SFSS australia

These credits are the American opportunity credit and the lifetime learning credit. In this article, we’ll talk about the lifetime learning credit, including who qualifies for it and how much it’s for, so if you’re in an institutions of higher education, make sure you’re paying attention.

Overview

The lifetime learning credit is a credit of up to $2,000 which is available to all eligible students. The best benefit of this credit is that there is no limit on how many years in a row a student can claim the credit, as long as they’re in school at the time.

The amount of your credit is usually controlled by how much income you have and the amount of taxes that you own. The credit is based on any education fees that you pay for yourself, your spouse or your dependent. You must have begun your enrollment in the beginning of 2012 or have been enrolled in higher education for the first three months of the year.

Limits

If you’re married and filing jointly, the income limit to qualify for this credit is $122,000. If you’re single, then your maximum income is $61,000. You must be attending at least one college course during the year to file for the credit. You cannot claim this credit if you are married, but filing separately.

Degree

This tax credit applies to anyone who is attending an institute of higher education. You do not need to be perusing a specific degree or have a concentration in a selected area to be eligible.

Residency

You must have been a legal resident of the United States for the entire year of 2012. If you were not a legal resident of the US for any part of the 2012 year, then you cannot qualify for the credit.

The lifetime learning credit may have some new changes as tax laws so often do. Any new changes can be found here,

Countries Scramble to get more slice of the pie

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Since the new “FATCA Rules”, OECD GUIDELINES and changes in the US internal revenue of service policies in relation to international taxation, several countries have started having a look at their own policies.

When times are uncertain  everyone tries to secure what they have  and prevent erosion of  existing wealth , and that’s what many countries are trying to do right now.

tightrope

Australia is now looking closer at tech company giants who are getting away with paying minimum tax in Australia as per media reports

Mr Turnbull told The Australian Financial Review he was consulting with chief executives of local media companies after the Australian division of global online search giant Google released accounts this month showing it paid only $74,176 in tax despite earning an estimated $1.1 billion in revenue in 2011.

The new cloud service delivery now being promoted by almost all big tech companies is only going to muddy the waters even more with transfer pricing and other tax issues relating to it, with many countries missing out in revenue.

So what is FATCA ?

After the FBAR (Foreign Bank Account Reporting)was released, the Foreign Account Tax Compliance Act (FATCA) introduces new, and largely parallel, reporting requirements. The FATCA reporting requirements carry their own set of penalties and are filed with the tax return rather than separately.

FATCA requires foreign financial institutions (FFI’s), to report information about accounts held by U.S. taxpayers directly to the IRS. This is a major compliance duty put on the Australian banks and borne by the Australian banks so that the US authorities can claim a piece of their pie. You can read more about FATCA here

The FATCA can impact on  several AUSTRALIAN Banks ,Savings and Loan Associations ,Credit unions, Co-operative banking institutions  and other financial institutions in australia

Transfer pricing to be scrutinised in australia

Cash-strapped governments around the world are targeting transfer pricing. Transfer pricing in short is defined as  the practice in which companies send profits overseas to subsidiaries in low-tax countries

The ATO has found 68 of Australia’s top 100 corporations in 2008 had a subsidiary in a tax haven, low-tax jurisdiction or bank secrecy country as per this media report.

Even in India recently the Vodafone case was high on the media reports internationally as  India looks to amend its tax laws after a defeat in this case resulting in a loss of millions of dollars to India

OECD AND ARMS LENGTH

Definition as per OECD :

This valuation principle is commonly applied to commercial and financial transactions between related companies. It says that transactions should be valued as if they had been carried out between unrelated parties, each acting in his own best interest.

The Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (ISBN Number:978926409003) provide guidance on the application of the “arm’s length principle” for the valuation, for tax purposes, of cross-border transactions between associated enterprises. (OECD BOOKS ON transfer pricing)

The British tax office is also under pressure to investigate Apple after it emerged the US-based technology giant paid £10 million in ­British tax in 2010 while generating an estimated £6 billion in revenue and Online retailer Amazon is reported for recording about £8 billion in revenue in Britain over three years without paying tax.

Canada also has cracked down on multinationals that dodge tax through inflating profits or losses in dealings with their related companies overseas

Even with  the deepening crisis in Europe , the EU are trying to impose carbon tax on International airlines using EU airports. The tax proposes to not only covers the flight through EU sky but through out the world. It is a scheme to impose ‘a sort of tax’ outside EU airspace  which has got the ire of some other countries

LINKS:

OECD AND AUSTRALIA

International Taxation: When the Transfer Pricing