Int'l Tax News

The US tariffs threatened, imposed, deferred, and changed throughout 2025 have created uncertainty for transfer pricing compliance. As multinational enterprises that import affected goods from related companies strive to navigate the changing landscape on material, new tariffs, they face increased costs, affecting not only their profitability but also their transfer pricing compliance. MNEs may be required to lower the transfer price paid to related companies for imported goods to remain within the arm’s length profitability ranges expected by the IRS.

The Group of 20 leaders committed to addressing concerns about the global minimum tax while ensuring that a solution will be fair to all countries.

More than 300 preferential tax regimes that encourage companies to shift their profits and avoid paying tax have been amended or abolished, according to an OECD report released.

A top OECD official said that rewriting the global minimum tax to meet the Trump administration’s demands to exempt American companies isn’t preferable, but acknowledged that the US is seeking changes rather than dismantling the tax.

A proposed side-by-side approach to enforcing a global minimum tax will hurt European competitiveness and threatens ambitions for a global level playing field, tax heads for Italian multinationals said.

The Forum on Tax Administration is working on developing compliance and risk review frameworks to facilitate the effective implementation of the OECD global minimum tax rules and reduce taxpayer burdens.

The Singaporean tax authority will implement the optional amount B simplified and streamlined approach for pricing baseline marketing and distribution transactions on a trial basis before deciding whether to make it permanent.

Multinationals are increasingly becoming embroiled in disputes with tax authorities around the world and spending less time on planning and strategy amid growing trade and economic concerns.

The Congressional Budget Office slashed its estimate of longer-term US fiscal savings from President Donald Trump’s tariff hikes by $1 trillion, in a move that may deepen concerns about American borrowing needs.

The 2025 update to the OECD model tax convention clarifies when a home office qualifies as a “place of business” and lists options for dispute resolution prevention.

Canada’s Department of Finance has tabled new budget legislation that would officially repeal the country’s digital services tax and implement a slew of tax credits and other incentives for businesses.

The OECD published its 2025 update to the model tax convention on income and capital, which includes changes and clarifications to provisions regarding the role of competent authorities within dispute resolution matters and tax treaty scopes; home working conditions as permanent establishments for tax purposes; the income tax treatment of natural resource extractions; transfer pricing and financial transactions; optional decision-making in dispute resolution mechanisms; and the use of information obtained through automatic exchange agreements.

Many countries expressed concern about a proposal that the United Nations set up and run a database to help developing nations have access to transfer pricing information under a new global tax treaty.

Don’t go making plans just yet to spend the $2,000 tariff “dividend” rebates President Donald Trump has proposed for millions of Americans.

The OECD has proposed a checklist aimed at making simplification more routine in multilateral tax policymaking, including in the inclusive framework on base erosion and profit shifting, while ensuring any complexity is measured and intentional.

Developed and developing countries were divided on whether a new United Nations tax treaty should include arbitration as a potential tool to resolve tax disputes.

The OECD expects further work for “many years” implementing the global minimum tax along with designing its new system with the US, according to an organization official.

In the three years since its founding, Syntesia has rapidly become one of the European Commission's key suppliers of tax analysis, reflecting a quiet shift in how the EU institution sources policymaking evidence after LuxLeaks.

 Countries signaled broad support for an approach to the dispute resolution protocol to the U.N. tax convention, but EU countries and others cautioned against the protocol superseding existing dispute resolution mechanisms.

The OECD on November 17 published its 2025 report on tax administration issues and trends across 58 of its member jurisdictions, finding that 69 percent of tax administrations had incorporated artificial intelligence in their operations as of 2023 and that 24 percent planned to implement similar systems in the future as tax administrations continue to serve as the primary government bodies that collect revenue.

Mindy Herzfeld examines possible paths for the Supreme Court to strike down some of the president’s tariff powers and whether the Trump administration’s objectives could be achieved through a more sensible cross-border tax policy.

The Trump administration continued its efforts to secure commitments from trading partners not to impose digital services taxes, netting agreements with six more countries.

The United States secured pledges from five countries to not impose digital services taxes in the last week in its quest to stamp out the growth of the levies through trade deals.

U.N. tax leaders plan to release in 2026 an economic analysis exploring concepts and approaches on a protocol to the U.N. tax convention for the taxation of cross-border services.

High-income and low-income countries continue to disagree on aspects of a U.N. framework convention for international tax cooperation, with wealthy nations arguing against the inclusion of provisions they say might duplicate OECD work.

Napoleão Dagnese explores geopolitics, the data revolution, and the role of international taxation and multinationals in distributing power, profits, and development.

Reuven S. Avi-Yonah examines problems with the U.S. withholding tax regime and recommends that the United States abolish it, including withholding tax on fixed or determinable annual or periodic income.

Robert Goulder comments on the CJEU's decision in Arcomet, finding that intragroup profit adjustments are within the scope of VAT.

Countries on three continents objected to a draft UN tax treaty provision over concern it would infringe on their right to choose how to resolve domestic tax disputes.

Over a dozen countries called for removal of draft language in a UN tax treaty they claimed would undermine barriers to international tax competition erected by the Organization for Economic Cooperation and Development.

Chinese tax authorities ordered e-commerce giants including Amazon.com Inc. to hand over sales data for the first time, according to people familiar with the matter, in a rare move to crack down on tax evasion by merchants who use the online platforms for cross-border business.

Alexandra Sherwood examines the International Maritime Organization’s global emission pricing mechanism and its similarity to a tax, and she explains that without the typical safeguards such as judicial review found in sovereign taxation, the mechanism could face problems of accountability, double taxation, and institutional legitimacy.

Several developed economies urged the United Nations to soften an overhaul of global taxing rights under negotiation aimed at creating an international tax treaty.

The high costs of complying with pillar 2 put EU-headquartered multinationals at a competitive disadvantage that should give EU policymakers pause, a new study concludes.

On October 26, the US announced trade agreements with Cambodia and Malaysia and framework agreements with Thailand and Vietnam. Although the agreements primarily impact bilateral trade between these countries and the US, and particularly the rate of customs duties imposed, various provisions and statements focus on other tax issues.

The United Nations’ ongoing efforts to alleviate information asymmetries between taxpayers and tax administrations are worthwhile but face long odds of success.

International tax policy advisers are picking up on the openness to pillar 1 alternatives recently expressed by Spain and Italy and suggested an “ecosystem access compensation” approach.

Mark J. Horowitz, Thomas D. Bettge, Donald C. Hok, and Vesela Grozeva examine the considerations specific to advance pricing agreements that arise when transfer pricing covered by an APA is materially affected by tariffs.

Following litigation over intellectual property transfers and a slowdown in tech sector growth, Israel has issued draft regulations for an improved investment fund tax regime and a notice concerning the taxation of research and development centers.

The arm’s length principle has been the foundation of transfer pricing rules for decades. It says that companies in the same group should price their cross-border transactions as if they were unrelated. However, global businesses today are more interconnected, data-driven, and centered around intangible assets. In this new world, ALP is becoming harder to apply and manage.

Canada’s new budget includes an enhanced research and development tax incentive program, a super deduction for businesses, and tax system integrity measures expected to increase revenues as the government reveals a C $78 billion deficit.

As member states continue to raise concerns about transatlantic tensions, EU countries' finance ministers are scheduled to discuss ongoing negotiations on pillar 2 changes in camera at next week's Economic and Financial Affairs Council meeting.

 A scheduled review of the United States-Mexico-Canada Agreement is shaping up to be the next battleground over digital services taxes in North America.

Lucas de Lima Carvalho examines the memoir of Pascal Saint-Amans regarding his work at the OECD and the book’s implications for a minilateralist compromise.

Bruce Zagaris explores the competition between the United States and China regarding international financial governance, trade, and policy objectives.

Mindy Herzfeld examines international developments around pillar 2 and considers whether the retaliatory taxes under the proposed but not enacted section 899 are still on the table.

An Organization for Economic Cooperation and Development group will explore developing a broader mechanism to help deliver businesses preapproved tax certainty.

Allaying the United States’ pillar 2 concerns is a political necessity for the EU that will require legal creativity to avoid delays and renewed tensions with the Trump administration, according to observers.

Ted Peterson examines past and present U.S. tariffs as well as the economic risks and rewards of a tariff-driven system, noting important distinctions between tariffs used strategically to support industrial development and those used solely as a revenue-generating or punitive measure.

French lawmakers voted to double the country’s tax on large technology companies, risking a backlash from Donald Trump who has long threatened to retaliate against the measure with trade tariffs.