Int'l Tax News

A U.N. official has expressed concern regarding the global shift toward implementing digital services taxes, asserting that they violate countries’ treaty obligations because they are essentially income taxes.

Current treaty provisions limiting access to mutual agreement procedures to resident taxpayers should be expanded to consider requests by companies under controlled foreign corporation regimes or subject to upcoming pillar 2 rules, an IRS official said.

Although the co-chair of the OECD inclusive framework on base erosion and profit shifting remains hopeful for a final pillar 1 tax agreement, its members are disappointed that it hasn’t happened yet.

Treasury is taking the reins on creating a comprehensive tax agreement with Taiwan after the House and Senate started legislative efforts to relieve double taxation.

A new EU legislative proposal would create a framework to exchange pillar 2 information from multinational entities among member states and with non-EU jurisdictions.

A newly approved article amending rules on cross-border fees on services in the U.N. model tax convention will be good for developing countries, but its controversial nature may hinder its implementation, a tax professor said.

Fair tax policies must take into account the increasingly contentious battle for taxing rights in the digital economy and the growing momentum of a U.N. tax convention, South African Revenue Service Commissioner Edward Kieswetter said.

Leopoldo Parada explains the development of an international forum for the creation of a more inclusive international tax regime; he focuses on developments at the U.N. and relates them to OECD developments in this area.

The former president has repeatedly praised a period in American history when there was no income tax, and the country relied on tariffs to fund the government.

The French National Assembly will soon discuss proposed amendments to the 2025 draft finance bill, which would increase France’s controversial digital services tax by at least 2 percentage points to raise much-needed revenue.

Wopke Hoekstra, EU commissioner-designate for taxation, told members of the European Parliament that while nearly all multinational enterprises will pay the global minimum tax under pillar 2 by 2025, the system is still at risk.

An estimated 90% of large multinational companies in scope of OECD rules will be subject to the minimum tax regime in 2025, the organization told G-20 ministers in a Thursday report.

An environmental committee of the European Parliament has adopted a set of demands for the upcoming U.N. Climate Change Conference that call on the European Commission to push for carbon pricing outside the bloc.

Doron Narotzki explores the resurgence of high tariffs in U.S. trade policy, beginning with the Trump administration and continuing into the Biden administration, that were initially intended to protect domestic industries and reduce trade deficits, but have instead led to increased consumer prices, strained diplomatic relationships, and harmed global trade dynamics.

Larissa Neumann, Julia Ushakova-Stein, and Mike Knobler review the extensive proposed corporate AMT regs, explain the ongoing effect of Loper Bright, review comments on stock buyback regs, and offer updates on the Treasury Inspector General for Tax Administration’s economic substance doctrine report, taxpayers’ compliance assurance process eligibility, and IRS advice on foreign-derived intangible income and 245A dividends received deductions.

Lee A. Sheppard examines the recently released dual consolidated loss proposed regulations.

Mindy Herzfeld examines the increasing complexities that multinational corporate taxpayers face in light of the recently released proposed corporate alternative minimum tax regulations, including the significant differences between accounting and income tax treatment of income.

Margrethe Vestager, executive vice president of the European Commission and commissioner for competition, told members of the European Parliament that the global community should keep working on pillar 1 and on an alternative.

Reuven S. Avi-Yonah explains the relationships between Chinese tax policy, pillar 2, and global multinational enterprises.

American groups and lawmakers are rallying behind a legal challenge filed in Belgium’s Constitutional Court against the undertaxed profits rule, but it could be a while before a decision is rendered — and success isn’t guaranteed.

Paul Poliakov explains how resolving double taxation and other inefficiencies of the U.S. domestic law regime for taxing foreign corporations could improve Taiwan-U.S. business relations.

Kartikeya Singh, Anthony Tufo, Shubhana Sattar, and Marco Fiaccadori explain the OECD inclusive framework’s amount B and the large effect it is likely to have on transfer pricing. They analyze the ways in which multinational enterprises can prepare for the various iterations that could arise as jurisdictions choose how to react to amount B.

David Farhat, Mayowa Olujohungbe, and Bryan McGrane explain why tax authorities can and should expediently address base erosion and antiabuse tax liability that may arise from taxpayers’ use of the advance pricing and mutual agreement program.

The Irish Department of Finance has issued draft legislation calling for amendments to existing laws to implement the OECD amount B political commitment and incorporate further global anti-base-erosion administrative guidance.

Final rules on the termination of income inclusions for repatriated intangible property track closely to proposed regs, with the drafters declining significant expansion over administrability and scope concerns and refusing to make the rules retroactive.

Anne Gordon explains why overzealous reporting legislation will negatively affect Australia’s international business relationships.

Jason Yen and Bona Chung provide examples that highlight the complexities of analyzing IP transactions under pillar 2 and explore questions that require further guidance.

India continues to deliberate on adopting the OECD’s 15% global minimum tax—also known as Pillar Two, a senior tax official said Thursday.

The OECD should allow a carve-out in the global minimum tax rules for mobile, tangible assets like ships and airplanes, according to an industry group representing cruise lines.

Portugal is planning to turn itself into a low-tax haven for young adults by offering a decade of tax breaks to people starting their careers in an effort to halt a growing brain drain.

Donald Trump has said he will end “double taxation” for millions of Americans living overseas if he wins the US presidential election next month.

Business groups and associations have responded forcefully in comments criticizing Treasury’s disregarded payment loss regs, arguing that the government lacks authority to issue the rules, as the Supreme Court made clear in Loper Bright.

The Swiss government expressed resistance to using financial transaction taxes to finance the country’s old age pension system.

Proposed corporate alternative minimum tax regs’ provisions pertaining to foreign-parented multinational groups, which have caught some tax experts by surprise, were drafted to ensure parity between foreign and domestic entities, according to Treasury.

Robert Goulder comments on the European Commission’s reinvigorated state aid case against the Netherlands and Ikea.

Mindy Herzfeld examines the saga of European state aid cases and the costs of the Court of Justice’s recent decision in European Commission v. Ireland for the U.S. government — and its taxpayers.

The EU Council legal service recently warned member states that the draft transfer pricing directive is getting in the way of an agreement on a nonbinding joint transfer pricing forum.

Brazilian President Luiz Inácio Lula da Silva has issued a provisional measure providing for a domestic minimum tax intended to be qualified as in line with the OECD’s global anti-base-erosion rules.

Hafiz Choudhury outlines the progress of draft Article XX on fees for services within the U.N. model tax convention’s evolution away from reliance on physical presence.

The European Union said negotiations for a new corporate tax treaty at the United Nations were potentially duplicating those taking place at the Organization for Economic Development and Cooperation in Paris.

As the OECD continues to promote Pillar Two, balancing the goal of fostering tax fairness with the need to avoid excessive compliance burdens is a challenge.

Rachel Reeves, the UK chancellor, is not expected to hit private equity bosses with the top 45p tax rate in this month’s Budget, as she looks for a compromise deal to close tax “loopholes” that does not drive investors out of Britain.

The European Commission is acting on a complaint by foreign-controlled companies operating in Hungary that the country's discriminatory retail tax regime puts them in a much higher tax bracket than domestic retail franchises operating there.

The European Commission has referred Cyprus, Poland, Portugal, and Spain to the EU’s highest court after warning them twice about their slow adoption of the EU’s directive for implementing global minimum tax rules.

EU member states have agreed to impose tariffs of up to 45 per cent on imports of Chinese electric vehicles, ratcheting up the biggest trade dispute between the economic superpowers in a decade.

Ten years of case law involving the EU banking union show that the EU has legal grounds to levy a contribution on companies in exchange for services, according to a European Parliament study.

Fabian Kratzlmeier argues that pillar 2’s group approach disregards the interests of creditors and minority shareholders, and he explores how long-standing concepts of civil, corporate, and bankruptcy law could be used to protect those interests within the global anti-base-erosion framework.

Ryan Finley explains why the EU member states may want to reconsider their objections to a transfer pricing directive after European Commission v. Ireland.

Christine Lagarde, president of the European Central Bank, said an EU capital markets union could be achieved through a 28th regulatory regime, including on taxation.

The U.S. Chamber of Commerce has expressed strong support for another American business group’s legal challenge against the undertaxed profits rule in the Belgian Constitutional Court, saying the measure is “fundamentally flawed.”