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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.
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Republicans Win Control of Tax Policy
Larissa Neumann, Julia Ushakova-Stein, and Mike Knobler explain how political changes may affect tax legislation and discuss the Tax Court’s ruling on penalties in Microsemi, the interest deduction ruling in Exxon, and comments on section 988 proposed regulations, among other developments.
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Tariffs and the Great Upcoming Tax Debate of 2025
Mindy Herzfeld examines U.S. tariff history and considers options for the next administration to achieve tariff advocates’ revenue goals and policy objectives.
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Assessing Effectiveness in International Tax Cooperation
Daniel Olika proposes a framework to measure success in international tax cooperation, arguing that effectiveness should be measured by both the process and the outcome.
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Trolling Tariff Fans
Robert Goulder considers what it will take for Congress to reclaim its tariff authority from the executive branch.
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Proposed PTEP Regs Dive Headlong Into the Complexity
After years of anticipation, the IRS and Treasury have released rules on previously taxed earnings and profits, which are exceptionally detailed and complex.
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EU Commission Closes Door on Long-Running State Aid Disputes
The European Commission has determined that Luxembourg and the Netherlands did not grant selective state advantages to Amazon, Fiat Chrysler, and Starbucks through advance pricing agreements.
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Breaking Down Trump’s Tariffs on China and the World, in Charts
President-elect Donald Trump made tariffs on China a defining feature of his first term. Now Trump is poised to ratchet up the pressure on China and other trading partners again, recently proposing an additional 10% tariff on all products from China and a 25% tariff on all Mexican and Canadian imports.
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Tariffs vs. VAT, With a Side Note on the BAT
Mindy Herzfeld examines the differences between tariffs and the VAT in light of upcoming debates over U.S tax rate changes, as well as how the destination-based cash flow tax might fit into the picture.
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U.N. Committee Adopts Outline for Tax Framework Convention
The U.N. Economic and Social Committee approved the bones of a framework convention on international tax cooperation, despite continued opposition from Global North countries.
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VIDA Reform Will Reshape the Digital Economy Landscape
Antonio Lanotte explains the European Commission’s VAT in the Digital Age reform for updating VAT regulations and modernizing VAT rules in light of rapid digitalization and increasing cross-border commerce.
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EU Closes Amazon, Starbucks and Fiat Probes on Tax Rulings
The decision ends three of the EU competition regulator’s attempts to crack down on international companies’ tax deals.
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EU Commission Calls Out Luxembourg Over Tax Planning Risks
The European Commission has singled out Luxembourg as the only EU country that refuses to adequately address aggressive tax planning, while Malta got the benefit of the doubt for promising to take steps to comply.
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Trump Targets Canada and Mexico With New Tariffs
President-elect Trump announced that he will introduce an additional 25 percent tariff on imports from Canada and Mexico until the countries stop migrants and drugs from crossing at the borders.
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Three Proposals for Fixing the TCJA
Reuven S. Avi-Yonah explains key issues facing the United States as it moves into 2025 with its potential major tax reform from the expiration of the Tax Cuts and Jobs Act.
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U.S. and China Corporate Tax Implications for Pillar 2 Adoption
Xiaoli Ortega analyzes and compares the corporate income tax structure and governmental incentives for U.S. and Chinese corporations. She identifies key differences between the countries’ corporate income tax structures and their implications for U.S. and Chinese economic and political goals, as well as the implementation of pillar 2.
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Trump Wields a Tariff Bludgeon
Donald Trump is still two months from returning to the White House, but he’s already wielding tariffs as an all-purpose bludgeon to achieve his political and foreign-policy goals. Markets will have to get used to it because this is going to be Mr. Trump’s second-term method, no matter the economic and strategic ructions.
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Trump Pledges Tariffs on Mexico, Canada and China
President-elect Donald Trump pledged that soon after taking office he will slap steep tariffs on Mexico and Canada, two of America’s closest allies, as well as China, the clearest indication since his election victory that he plans to follow through on the tough campaign rhetoric that helped propel him to the White House.
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Lighthizer on Trade, Tariffs, and International Tax
Mindy Herzfeld reviews former U.S. Trade Representative Robert Lighthizer’s 2023 book, No Trade Is Free: Changing Course, Taking on China, and Helping America’s Workers, for insight on possible trade and international tax policy in the next administration.
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Manufacturers Push for Preservation of TCJA International Rates
The National Association of Manufacturers is calling on Congress to stop the scheduled taxpayer-adverse adjustments to rates for key international tax provisions of the Tax Cuts and Jobs Act set to take effect after 2025.
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EU Official Says Avoiding Pillar 2 Tensions With U.S. Is Possible
It shouldn’t be "Mission Impossible" to persuade the United States to amend its minimum tax so the EU won’t have to apply the undertaxed profits rule to U.S. companies, a top EU tax official said.
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Tax Brief Cautions Countries About Amount B Scoping Criterion
Jurisdictions implementing the amount B transfer pricing simplification framework should carefully analyze distributors within their borders before setting the upper bound of a key criterion for identifying in-scope distributors, a South Centre tax brief says.
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Puerto Rico Told Qualified Minimum Tax May Not Be Possible
It’s unlikely that Puerto Rico will be able to introduce a qualified domestic minimum top-up tax in line with OECD pillar 2 rules because of its tax decree regime, business stakeholders told the island’s Treasury.
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Apple Ruling Exacerbates Absurd Situation, Saint-Amans Said
Former OECD tax director Pascal Saint-Amans said the EU should seriously debate profit allocation among member states after the Apple state aid decision and the standstill on pillar 1 of the OECD’s global tax plan.
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The Irish Government Is Unbelievably Rich. It’s Largely Thanks to Uncle Sam.
A clampdown on global corporate tax dodging turned Ireland into the nouveau riche man of Europe.
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Romania Risks Fallout From Early CbC Reporting Rollout
The American Chamber of Commerce in the EU has written again to the Romanian Ministry of Finance, warning that its early implementation of mandatory public country-by-country reporting throws into question the country’s “commitment to competitiveness.”
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Operationalizing the Formulary Apportionment Method in Pakistan
Sol Picciotto and Muhammad Ashfaq Ahmed argue that it is time for countries to move toward using the formulary apportionment method for taxation of multinationals and focus on Pakistan to show how this could be done, in concert with other willing countries, based on standards now agreed to by the BEPS inclusive framework as part of its two-pillar solution.
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Tariff Retaliation Threatens American Pockets
The widespread tariffs touted by President-elect Trump during his campaign could raise prices and draw global retaliation, leading to additional costs for American consumers and importers.
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Portuguese Tax Benefits Promote Internationally Competitive Business
José de Campos Amorim explains how recent Portuguese tax legislation presents a series of tax benefits for business development by reducing the tax burden and attracting investment in various sectors of the economy.
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Looking Past Pillar 1 Through a DST World
Mindy Herzfeld examines digital services taxes and the role U.S. retaliatory measures against them might play in a world of more comprehensive tariffs.
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DAC9 Will Slash Pillar 2 Reports by Tens of Thousands, EU Says
The ninth EU directive on administrative cooperation, a proposed framework for exchanging multinational entities’ pillar 2 information between member states, will substantially reduce reporting, according to a top tax official on the European Commission.
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Sluggish Carbon Pricing Progress Poised to Pick Up, OECD Says
While global emissions coverage by carbon pricing instruments appears to have stalled in recent years, emissions trading systems under development are expected to substantially expand that coverage, according to a new report.
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Should Ireland Have Taxed Apple?
Reuven S. Avi-Yonah and Nessa Ní Chasaide argue that the EU's Court of Justice was misguided in the recent Apple ruling, which raises significant issues relating to the legal governance of corporate tax.