New Levies

The US announced additional duties on Chinese goods after Trump accused Beijing of not taking sufficient action to stop the flow of illicit drugs. China responded within minutes. The Finance Ministry in the Asian country announced a 10% tariff on US crude oil, specific autos, and farm equipment.

The ministry also imposed a 15% tariff on US liquified gas and coal. The Chinese tariffs on US coal and LNG will take effect on February 10. At the same time, the Commerce Ministry of China and the Customs Administration have announced plans to impose export controls on rare earth metals, including tellurium, tungsten, bismuth, indium, and molybdenum.

The two government ministries said the controls are aimed at safeguarding China’s national security interests. China is the biggest supplier of rare earths in the world. Rare earths are critical in the transition to clean energy.

High Stakes

Trump started a fierce trade war between the US and China in 2018. The war, which lasted for two years, was triggered by a high US trade surplus. Beijing responded to punitive tariffs imposed by the US on Chinese goods in 2019. This China-US trade war affected the global supply chains and affected the world economy. Drug trafficking is at the center of Trump’s trade policy with China. The US President has warned that he could slap China with additional tariffs unless the country curtails the flow of fentanyl into the US. Fentanyl is a deadly opioid.

“China hopefully is going to stop sending us fentanyl, and if they’re not, the tariffs are going to go substantially higher,” Trump said on Monday.

But China says it will challenge new duties at the World Trade Organization. The country argues that fentanyl is a US problem and has promised to counter the tariffs. The country says it’s still open to talks. Compared to the 2018/19 trade ware, the stakes are higher now. In 2024, China imported 4.16 million tons of LNG from the US. This is almost double the amount it imported in 2018.

It has emerged that the two countries could be working on a solution after the timing for talks between President Trump and President Xi Jinping was escalated. The conversation between the two had been scheduled later this week. However, it’s likely to take place within the next 24 hours.

New Deals

On February 3, Trump suspended his decision to impose a 25% tariff on Canada and Mexico. This happened after the parties agreed to a 30-day pause in order to bolster enforcement efforts on the border. Experts say it might be harder for the US and China to agree on a deal.

“Unlike Canada and Mexico, it is clearly harder for the U.S. and China to agree on what Trump demands economically and politically. The previous market optimism on a quick deal still looks uncertain. Even if the two countries can agree on some issues, it is possible to see tariffs being used as a recurrent tool, which can be a key source of market volatility this year,” Gary Ng, Senior Economist at Natixis said.

Antitrust Investigation

China has also announced that it will commence an anti-monopoly investigation on Google. The Chinese regulatory watchdog, State Administration for Market Regulation, said it will be investigating Google for possible violation of the country’s anti-monopoly regulation. Google stopped providing search engine and internet services in China back in 2010.

However, the tech giant runs some operations in the country. These include supporting Chinese businesses that seek to advertise abroad through its platforms. As the Chinese government launches its probe on Google, some experts believe the exercise could conclude without any fines.

Google isn’t the only US company that the Chinese government will be investigating. China will also probe biotech firm Illumina for an unreliable entities list. The Asian economic giant will also be investigating PVH Corp, the company that holds brands like Calvin Klein.

The post Beijing-Washington Trade War Intensifies as China Imposes New Tariffs on US Goods appeared first on Tech Research Online.

The global electronics manufacturing company plans to assemble Nvidia AI servers in Mexico. This means the products would be subject to Trump’s tariffs if they take effect.

New Challenge

Tech companies have previously grappled with tariffs on consumer goods from China in 2018. However, the tariffs that the Trump administration has proposed to impose on electronics imported from Mexico present a new challenge. This is because most firms expanded their production to the country as they sought to manage COVID-19 disruptions.

“If we increase the tariffs on Mexico, it’s actually penalizing the companies that have been very progressive and trying to make great strides and restructure their supply chain,” Supplyframe CMO, Richard Barnett said.

Trump will be providing details about the specific tariffs that his administration will be placing on imports from Mexico, Canada, and China. Investors will be seeking to know what impact Trump’s tariffs on technology will affect big tech businesses as Microsoft, Apple, and Tesla release their quarter four earnings this week.

High Consumer Prices

Experts warn that trade wars fueled by new tariffs can lead to gadget price raise for consumers and slow global commerce. Analysts say that the Trump administration could be seeking to use the new taxes to negotiate with countries over concerns like migration and drug trafficking.

“The four big implications of tariffs that I foresee are higher prices, fewer rate cuts from the Fed, slower growth and fewer new jobs,” Brett House, Professor at Columbia Business School.

During campaigns, the US President hinted at imposing a 10% tariff on all imports and a 60% tariff on goods imported from China. Since taking office, Trump has already backed off from large duties and is discussing 10% duties across board for imports from Canada and Mexico; and 25% for goods from China.

Pursuing a 60% duty on Chinese imports would have a big impact on US buyers. If applied, such duties would push tablet and laptop prices up by 45%. The cost of video game consoles would surge by up to 40%. Smartphone prices would increase by 26%, which represents a $213 increase.

“It’ll affect the unit sales, meaning that each product will go up in price significantly,” Gary Shapiro, CEO at CTA said.

Mexico-US Trade

In 2023, electronic imports from Mexico increased by 18% to hit the $103 billion mark, up from $86 billion in 2019. Mexico is the second-largest electronic product source for the US after China. In 2023, the US imported electronic products worth $146 billion from China.

Over the last few years, Foxconn, Hisense, and Lenovo announced plans to set up factories in Mexico. Singapore-based electronics and gadgets maker, Flex claims that it is the biggest exporter in Jalisco- Mexico. The Trump administration may be seeking to ensure that Chinese firms like Hisense and Lenovo do not avoid duties by expanding to Mexico.

“If you look at Chinese investment into Mexico, it has gone through the roof in the last three to five years,” Simon Geale, Executive VP at Proxima said.

The post How Trump Tariffs Could Raise Prices of Electronic Devices and AI appeared first on Tech Research Online.

Driving Tax
Transformation: Three
Cloud Adoption Success
Stories

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Driving Tax Transformation: Three Cloud Adoption Success Stories appeared first on Tech Research Online.

Moving Tax to the
Cloud: A Financial
Perspective

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Moving Tax to the Cloud: A Financial Perspective appeared first on Tech Research Online.

Driving Tax
Transformation: Three
Cloud Adoption Success
Stories

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Driving Tax Transformation: Three Cloud Adoption Success Stories appeared first on Tech Research Online.

Why Tax and IT Need to
Work Together When
Connecting a Tax Engine
to an ERP System

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Why Tax and IT Need to Work Together When Connecting a Tax Engine to an ERP System appeared first on Tech Research Online.

Cloud for Everyone – Including
the Tax Function

About Vertex Inc.

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Cloud for Everyone – Including the Tax Function appeared first on Tech Research Online.

Digital Transformation: The
Case for Moving Tax to the
Cloud

About Vertex Inc.

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Digital Transformation: The Case for Moving Tax to the Cloud appeared first on Tech Research Online.

Driving Tax
Transformation: Three
Cloud Adoption Success
Stories

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Driving Tax Transformation: Three Cloud Adoption Success Stories appeared first on Tech Research Online.

Optimizing Business
“ilities” with Vertex’s
Cloud Solutions

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Optimizing Business “ilities” with Vertex’s Cloud Solutions appeared first on Tech Research Online.

Why Tax and IT Need to
Work Together When
Connecting a Tax Engine
to an ERP System

About Vertex

Vertex Inc. stands at the confluence of tax expertise and technological innovation. Our mission extends beyond providing tax solutions; we empower businesses to harness the full potential of their tax operations as a strategic advantage. With decades of industry leadership and a commitment to excellence, Vertex Inc. offers not just tools, but transformation.  

The post Why Tax and IT Need to Work Together When Connecting a Tax Engine to an ERP System appeared first on Tech Research Online.

Reuters reported that the Wise CEO was fined after he violated the Senior Management Conduct Rule 4 when he failed to notify the regulator of a £365,651 penalty he paid to HM Revenue and Customs (HMRC) in February 2021.

Kaarmann had attracted the penalty after he failed to inform the tax authority of a capital gains tax liability after he sold shares worth $10 million in 2017.

Appearing on the Tax Defaulters List

The HMRC had added Wise CEO to its public list of tax defaulters in September 2021. Kaarmann appeared on this list alongside sole traders and takeaway restaurants. The list comprises people who deliberately default on tax payments.

The listing matter and the circumstances surrounding it influenced FCA’s assessment of Kaarmann’s fitness and propriety. According to the UK financial regulator, Kaarmann was aware of his tax issues for over seven months.

However, he failed to appreciate the weight of these matters and did not inform the FCA about them. The FCA emphasized the need for transparency from fintech leaders.

“We, and the public, expect high standards from leaders of financial firms, including being frank and open.” FCA Joint Executive Director for Oversight and Enforcement, Therese Chambers said,

Cooperation with the FCA

UK’s fine on Wise CEO brings to an end years of navigating the regulatory difficulties brought about by Kaarmann’s share sale. Although the FCA has the power to declare that Kaarmann is not a proper director of a regulated business, the UK regulator fine was based on the consideration that Kaarmann’s actions were careless, not reckless or deliberate.

The HMRC has fined Kaarmann for failing to open two letters informing him of the tax liability. The Wise CEO cited his tight travel schedule as the reason why he had missed the letters. When he realized his mistake, Kaarmann settled the penalty immediately but did not communicate the matter to the FCA.

Originally, the HMRC had fined Kaarmann a total of £500,000. However, the CEO received a 30% discount for demonstrating cooperation at an early stage.

“After several years and full cooperation with the FCA, we have brought this process to a close. I remain focused on delivering the mission for Wise and achieving our long-term vision for being ‘the’ network for the world’s money, ” Kaarmann said.

Wise Chairperson, David Wells says the matter is now settled and that the company has ensured that Kaarmann tax affairs are in order. The FCA regulates Wise since it is a business that offers electronic money services and share dealing.

Background to Wise Tax Compliance Issue

Kaarmann conceptualized the Wise fintech idea while working for an accountancy firm in London. He co-founded the fintech company with Taavet Hinrikus in 2011.

At the time, the fintech company was known as TransferWise. However, Kaarmann was confronted with high fees when he wanted to transfer bonus payments to his country, Estonia.

To avoid the hefty bank fees, Kaarmann worked with Hinrikus to match financial transactions in the two countries.

Wise grew fast to become the go-to fintech solution in London. In 2021, the company’s float grew to a point where it made its co-founders billionaires. Today, Wise valuation stands at £7.5 billion. Kaarmann has an 18% stake in Wise and an estimated net worth of £1.7 billion mostly from his stake in the fintech company.

The post Wise CEO Fined by UK Regulator for Non-Disclosure of Tax Liability appeared first on Tech Research Online.