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Top OECD Delegate Says US Is at 'Crossroads' on Global Tax Deal
The US has a critical decision to make in the near future over whether it will continue to negotiate at the OECD and see through the work on the global minimum tax, a top Treasury official said Thursday.
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Can Treasury Make Amount B Mandatory After Loper Bright?
Ryan Finley explains why Treasury and the IRS likely have the statutory authority to make a simplified approach to baseline distribution mandatory.
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Estes Warns U.S. Allies of Shift in Global Minimum Tax Stance
The second Trump administration and Republican-controlled Congress are poised to oppose the OECD’s global minimum tax rules, and countries shouldn’t ignore the policy shift, according to House Ways and Means Committee member Ron Estes, R-Kan.
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TCJA: The False Dawn of Tax Reform
Doron Narotzki and Vered Narotzki argue that the Tax Cuts and Jobs Act’s short-term economic stimulus has been overshadowed by mounting fiscal challenges and unfulfilled promises. They highlight concerns about the sustainability of extending the expiring provisions without addressing revenue shortfalls and call for a targeted restructuring of the TCJA provisions to prioritize long-term fiscal stability over short-term political gain.
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OECD Confirms Countries With Qualified Minimum Tax Rules
The OECD on Wednesday provided an update with a list of countries that have implemented minimum tax legislation that meets the secured transitional qualified status.
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OECD Bars Some Deferred Tax Assets in Global Tax Calculation
Certain deferred tax expenses will be excluded from transitional global minimum tax calculations under new OECD guidance, in an effort to prevent taxpayers from manipulating such calculations.
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EU Seeks Quick Adaptation to Future Pillar 2 Infor Exchange Tweaks
EU member states are discussing legal ways to ensure that any future changes to the OECD’s standard global anti-base-erosion information return that are implemented through the EU administrative cooperation directive can be introduced quickly.
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Amount B Framework Concerns Persist in OECD Tax Negotiations
Concerns from some jurisdictions about a key part of the amount B transfer pricing simplification framework remain a hurdle in finalizing an agreement on pillar 1 of the OECD’s two-pillar global tax reform plan.
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Germany and Netherlands Identify EU Tax Rules to Amend or Revoke
Pillar 2’s global minimum tax “will secure a broad level of protection against harmful tax competition and aggressive tax planning” and some EU antiabuse rules should be simplified or abolished, Germany and the Netherlands said.
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U.S. Tax Creditability of French Cotisation Subsidiaire Maladie
Hilary B. Miller explains the basis on which a foreign tax is creditable for U.S. taxpayers and applies the reasoning to France’s social charge called the cotisation subsidiaire maladie.
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OECD Publishes Paper on Business Functions, Corporate Taxation
The OECD on January 13 published a working paper on the relationship between multinational enterprise business functions and effective corporate taxation using country-by-country reporting data from 2017-2021, finding that business functions are effectively influenced by tax incentives and antiavoidance rules and that tax has less influence on corporate decisions regarding routine functions such as manufacturing and sales.
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OECD Co-Chairs Issue Statement on Pillar 1 Negotiations
The OECD inclusive framework on base erosion and profit shifting's co-chairs issued a statement January 13 about the current state of pillar 1 negotiations, reiterating its commitment to ironing out the concerns that member jurisdictions have regarding amount B provisions and reaching a finalized agreement.
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Proposed PTEP Regulations, Dividend Equivalent Redemptions, and Granite Trust
Lee A. Sheppard considers what happens to basis in dividend equivalent redemptions involving controlled foreign corporations with earnings and profits representing previously taxed earnings and profits, a problem Treasury plans to address in future rulemaking.
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Digital Transaction Regs Undergo Big Changes After Taxpayer Concerns
Regs on cloud and digital transactions have undergone significant changes from earlier rules, answering practitioners' calls to adopt a predominant character rule surrounding transactions and modify sourcing and cloud classification rules.
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Final DPL Regs Provide Carveouts for Minority Interests
Final regulations on applying disregarded payment losses provide widespread relief by delaying the implementation date and creating carveouts for royalty payments and fractional ownership.
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EU Publishes Final FASTER Withholding Directive
The EU has published the final Faster and Safer Relief of Excess Withholding Taxes directive, which was approved by the EU Council in December 2024 and allows member jurisdictions to provide relief of excess withholding taxes on cross-border investments as part of its initiative to tackle tax fraud.
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Donald Trump’s return raises prospect of global tax war
According to a U.S. official, challenges in global anti-base-erosion (GLOBE) rules negotiations under the OECD's pillar 2 taxation framework have made a permanent safe harbor provision seem unlikely.
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EU Research Institution Publishes Pillar 2 Working Paper
The EU Tax Observatory published a working paper January 8 explaining how the OECD's pillar 2 global minimum tax rules could affect government revenue and the potential impact on profit shifting using data reports from active multinational enterprises in Slovakia, finding that the 15 percent global minimum tax could help increase the country's corporate tax revenue by 4 percent.
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A TJCA Update Is Needed Now for the Definition of Intangible
Ryan Finley explains why Treasury and the IRS shouldn’t indefinitely postpone a Tax Cuts and Jobs Act-conforming update to the transfer pricing regulations’ definition of intangible.
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Trump Denounces Reports of Scaled-Down Tariff Policy
President-elect Trump has said newspaper reports that his aides are working on tailored tariff plans that would only target critical imports are incorrect.
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A Fresh Start: Searching for Consensus in International Tax Reform
In this article, Sol Picciotto argues that the negotiations at the U.N. offer an opportunity to overcome the increasing dissensus in international tax rooted in the polarization between residence and source taxation, and that while a new consensus may be difficult to reach, it could be more sustainable.
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Will the New Administration Take Down Controversial Regs?
Mindy Herzfeld reviews existing controversial regulations and discusses whether they are likely to be eliminated under the incoming presidential administration.
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OECD’s Two-Pillar Tax Reforms Enter Murky Waters in 2025
As the pillar 1 agreement hangs in the balance and questions arise about pillar 2 global minimum tax implementation, the outlook for the OECD-brokered tax reforms is anything but crystal clear.
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How 2025 Will Weave Tax Into the EU’s Policy Baskets
With a fresh European Commission ready to make its mark and Poland steering the EU Council presidency, 2025 is poised to shape the role of taxation in the bloc’s policies for the next five years.
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Global North and Global South Set for Showdown at U.N. Tax Talks
Global South countries are prepared to dive into substantial tax matters for the U.N. tax convention this year, but they could be waylaid by Global North countries demanding more specifics about the decision-making process.
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Pilar 1 Importe B: Implementación Potencial en Meéxico y América Latina
Enrique González, José Carbajal, Ana María Romero, and Kent P. Stackhouse explain the unique challenges that must be considered if pillar 1’s amount B is implemented in Mexico and Latin America.
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Offshore Indirect Transfers and Their Future in International Tax
Luis de la Cruz explains the taxation of offshore indirect transfers.
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Shaping the International Tax Cooperation Regime: The U.N.’s Role
Anirudh Raghavan questions the U.N.’s role in the international tax community and suggests ways of moving further toward international tax cooperation and equality.
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The Two-Pillar Solution: After Three Years, Where Are We?
Jefferson VanderWolk offers a sobering assessment of the two-pillar project and the brewing conflict between the OECD and the U.N.
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Fifth Circuit Puts Corporate Transparency Act Back on Hold
A Fifth Circuit panel has reinstated an injunction halting the enforcement of the Corporate Transparency Act in Texas Top Cop Shop Inc. v. Garland and scheduled oral arguments for March 2025.
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U.N. Assembly Agrees to Kick Off Talks on Framework Convention
The U.N. General Assembly has adopted a resolution approving the terms of reference for a framework convention on international tax cooperation, but EU countries and the United States have raised concerns about two specific paragraphs.
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Pillar One of Global Tax Reform Faces a Tipping Point in 2025
A make-or-break year is coming for Pillar One, the first half of a two-part global tax overhaul that aims to reallocate corporate profits to address digitalization of the economy and reform rules for transfer pricing, which dictate how multinational corporations value their intercompany transactions.
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European Union Year in Review: A Grab Bag of Decisions
Lee A. Sheppard explains important 2024 tax developments in the European Union, including key tax decisions in the EU’s Court of Justice.
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Reasserting U.S. Tax Leadership, Starting With Amount B
Mindy Herzfeld examines how pillar 1’s amount B — which generally streamlines transfer pricing rules by adopting set margins — could be consistent with an America First agenda.
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IRS Explains Use of Shareholder-, Corporate-Level PTEP Accounts
The IRS is articulating its reasoning for the proposed regs on previously taxed earnings and profits (PTEP) requiring a dual system of accounting at both the corporate level and shareholder level.
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OECD Issues Pricing Tool to Automate Amount B Return Calculations
The OECD has released an automated tool for pricing a return on sales for baseline distributors that are in scope of the amount B transfer pricing simplified and streamlined approach.
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Lower Corporate Tax Rate for Domestic Manufacturing?
Reuven S. Avi-Yonah explains how reducing the corporate tax rate for domestic manufacturing could encourage multinationals to expand activities in the United States.
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IRS to Propose Regs on OECD Amount B Transfer Pricing Approach
The IRS is asking for stakeholder feedback with the intention of proposing regs in line with the OECD’s report on the amount B simplified and streamlined approach for pricing baseline marketing and distribution transactions.
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How the U.S. Foreign Tax Credit Can Rescue Pillar 2
Patrick Driessen argues that the revenue and general nonrevenue policy effects of pillar 2 look more favorable after consideration of the U.S. government’s obligation to regulate foreign tax credits to discourage quid pro quo subsidy schemes of foreign governments.
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OECD Tracks Nearly 60,000 Tax Ruling Exchanges Since 2016
More than 58,000 exchanges of information on tax rulings took place between 2016 and 2023 under action 5 of the base erosion and profit-shifting project, according to the OECD’s latest peer review report.
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Replacing the Pillar 2 UTPR With an Undertaxed Payments Rule
Thomas Horst examines differences between the undertaxed payments rule and the UTPR, or undertaxed profits rule, and whether adoption of the former could resolve incongruities between the laws of the United States and the many countries that have enacted the UTPR and provide a legally acceptable alternative to the UTPR.
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Incoming EU Council Presidency’s Tax Ambitions Limited to DAC9
The continuation of work on the ninth directive on administrative cooperation is the only direct taxation priority listed in the six-month program of the next EU Council presidency.
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Levine Urges United States to Stay at OECD Tax Negotiation Table
The United States must continue engaging at the OECD on tax issues like the two-pillar global tax reforms to protect its interests and promote its global leadership, Treasury’s top OECD negotiator said.
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FDII Deduction Supports Significant U.S. Economic Activity
Brandon Pizzola and Hilary Gelfond-Gross analyze the economic effects of the foreign-derived intangible income deduction, the economic activity supported by the deduction, and the macroeconomic impacts of repealing it.
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OECD Transitional Pillar 2 Tax Peer Review Nearing Completion
The OECD’s transitional peer review process for determining which jurisdictions have enacted measures qualified as in line with the pillar 2 rules is winding down, and a list of those jurisdictions may be published soon.
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IRS Guidance Will Address Pillars and Penalties, Bello Says
U.S. guidance on transfer pricing penalties, featured prominently in recent litigation, will be even more critical under the amount B transfer pricing approach under pillar 1 of the OECD’s global tax reform plan, practitioners warn.
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Should FDII Be Abolished in 2025?
Reuven S. Avi-Yonah describes the looming international conflicts regarding the U.S. foreign-derived intangible income provision.
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The Commensurate With Income Standard in Transfer Pricing
Prita Subramanian and Thomas Zollo examine the evolution of the commensurate with income standard, its current and prospective application, and its practical implications for taxpayers.
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Trump’s Tariffs: Would the DelBene-Beyer Bill Change Anything?
Robert Goulder comments on President-elect Trump’s recent tariff threats.
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Democrats Push to Fast-Track Taiwan Double Taxation Relief Bill
Democrats are planning to move quickly on a bill providing a double taxation fix between the United States and Taiwan, with hopes to get the legislation to President Biden’s desk before the end of the year.