EU Counties to Work Out Pillar 2 Policy Options
EU ambassadors have asked the high-level working party on tax questions to discuss pillar 2 of the OECD’s global corporate tax project in light of the United States’ disengagement and to work out policy options.
Pillar 2 Guidance, EU Directive Face Compatibility Questions
Doubts have emerged about the compatibility of the pillar 2 administrative guidance released by the OECD inclusive framework in 2023 and 2025 and the EU’s pillar 2 directive, which was approved in 2022, observers say.
Exempt Small Economies From New Tariffs, U.N. Exhorts U.S.
Small, vulnerable countries should be exempt from new U.S. “reciprocal tariffs” because the new measures could devastate their economies without meaningfully affecting U.S. trade deficits or increasing U.S. revenue, according to a U.N. department.
Evaluating Possible U.S. Retaliatory Tax Measures
Danielle Rolfes, Casey Caldwell, and Alistair Pepper explore some of the key issues presented by four retaliatory tax measures now under consideration by President Trump and Congress to respond to discriminatory or extraterritorial taxes imposed by foreign countries.
U.N. Body Examines U.S. Tariffs’ Impact on Developing Countries
The U.N. Conference on Trade and Development published a report on April 14 analyzing the potential impact of U.S. tariffs on small and developing countries, including information on how more vulnerable countries would not significantly affect the United States' additional tariff revenue collections but would be disproportionately affected by high tariff rates.
OECD Talks Continue on Two-Pillar Global Tax Reforms
Jurisdictions in the OECD inclusive framework on base erosion and profit shifting, including the United States, have confirmed they will keep going with negotiations on the OECD’s plan to revamp the corporate tax system.
UTPR Permanent Safe Harbor Easier for EU, Dutch Official Says
Extending the transitional undertaxed profits rule safe harbor to ease U.S. concerns over pillar 2 would be easier under the EU directive than by granting the United States minimum tax equivalence, a Dutch official said.
Key Case Law Developments, Recent IRS Rulings, and Trump’s Response to DSTs
Larissa Neumann and William R. Skinner examine the Trump administration’s calls for action against countries with discriminatory or extraterritorial taxes in place; review recent important case law developments; and explore IRS rulings on the controlled foreign corporation group election under section 163(j), check-the-box, and proposed regulations for previously taxed earnings and profits.
German Coalition to Lower Corporate Taxes, Support Pillar 2
Germany’s mainstream political parties have pledged to cut corporate tax rates while supporting the OECD’s minimum tax plan as part of an agreement that lays out the framework for a governing coalition.
GLOBE and the Excess Negative Tax
Lucas de Lima Carvalho explores the excess negative tax introduced in the model rules, which raises concerns about ability to pay and whether jurisdictions can tax “income” that constituent entities did not earn in the relevant fiscal year.
A Shifting Landscape: International Taxation of Software Payments
Giammarco Cottani and Nadia C. Altenburg explain the necessity for international consistency regarding taxation of software to avoid an escalating rift between technology-exporting and technology-importing countries.
U.S. Tariffs Solidify MEPs’ Stance on EU Competition Rules
Members of the European Parliament said EU competition rules are not a bargaining chip to avoid U.S. tariffs and that companies structured through tax havens should be barred from receiving state aid.
BusinessEurope Asks EU to Reassess Its Position on Pillar 2
Advocacy group BusinessEurope urged the EU to consider the United States’ disengagement from the OECD’s global tax plan to ensure that the bloc’s pillar 2 implementation doesn’t expose its businesses to "geopolitical and economic retaliation."
Automation of Transfer Pricing Analysis Beyond Amount B
Kerem Yener Toklu proposes an approach to estimate the distribution of returns for a tested party based on its entity- and market-specific factors, enabling the identification and statistical testing of economically significant risks while capturing the risk-return tradeoff.
How to Simplify New Cloud Computing Regs for Greater Taxpayer Certainty
Paul Poliakov explains the key features of proposed cloud computing transaction regulations and suggests how to simplify the rules to promote taxpayer certainty and reduce compliance problems.
More Countries Decline to Adopt Amount B Framework
The Spanish government has published in its official gazette regulations that implement its global minimum tax regime, covering administrative issues including tax calculations, information return filing, and penalties.
CARICOM to Update Multilateral Tax Treaty
Caribbean Community (CARICOM) officials have finalized a protocol to the 1994 CARICOM income tax treaty that would align the agreement with international standards for information exchange and dispute resolution, according to a March 31 release published on the CARICOM website.
USTR Identifies EU Countries With Taxes That Hamper Trade
The Office of the U.S. Trade Representative has cataloged EU countries' taxes that it considers trade barriers hindering U.S. exporters in a report published ahead of President Trump's self-declared “Liberation Day.”
NTUF Says Trump Should Push for End to Digital Services Taxes
President Trump should stop negotiating with the OECD on the global tax deal but could continue talks to eliminate digital services taxes, but he should leave negotiations if United States interests aren’t addressed, the National Taxpayers Union Foundation said in a March 28 report.
Tariffs, Trade, and Transfer Pricing: A Guide to Navigating Economic Uncertainty
Wes Cornwell, Ana María Romero, and Kirsten Speas examine the rise of tariffs in international trade and explain their effect on typical manufacturing models across four sectors of the economy.
International Tax Wish List, Part 2: Addressing Subpart F and GILTI
In Part 2 of a series, Mindy Herzfeld suggests substantive changes to international tax rules necessitated by the Tax Cuts and Jobs Act and later global tax developments, including pre-TCJA provisions that need revision and TCJA law changes not functioning as intended.
Post-Loper, IRS Has Its Eye on Transportation Case
The IRS is highlighting a Department of Transportation appellate court decision as an “interesting” development following the elimination of Chevron deference, as debate swirls over reg writing authority based on a general rulemaking statute.
EU Groups Propose Pillar 2 Permanent Safe Harbor Features
BusinessEurope and Accountancy Europe have told the Platform for Good Tax Governance that a new OECD global minimum tax permanent safe harbor should be designed without the “once out, always out” rule to ensure its effectiveness.
Revitalizing the U.S. Semiconductor Supply Chain Through Tax Policy
Patrick M. Ryle, Caleb S. Watkins, Keith Carruthers, and Robert Haverland examine the final regulations on the advanced manufacturing investment credit, focusing on the direct-pay election, the denial of the double benefit rule, and the excessive payment rule.
Reeves Hints at U.S. Tariff Pressure Regarding U.K. DST
U.K. Chancellor of the Exchequer Rachel Reeves indicated the digital services tax is part of tariff discussions with the U.S. government but dodged questions about whether she is under pressure to drop it.
No Amount B in Austria’s Detailed Transfer Pricing Rules Update
A comprehensive revision of Austria’s transfer pricing guidelines presents rule changes as mere clarifications despite their partially retroactive tightening effect, while simultaneously omitting any guidance on the OECD’s amount B concept.
Cloud Services Sourcing Regulations: Moving in the Right Direction?
Paul W. Oosterhuis, Will Shirey, and Moshe A. Gershenfeld analyze a recently proposed method for determining the source of income for international cloud transactions that are characterized as services for sourcing purposes, arguing that the proposed regulations can help achieve certainty for global businesses.
Does Transfer Pricing Have a Loper Bright Problem?
Thomas D. Bettge, Mark R. Martin, and Hans Gerling consider how the Supreme Court’s decision in Loper Bright may affect the application of section 482, the first sentence of which serves as the basis for the entire U.S. transfer pricing system but does not squarely address one of Loper Bright’s guardrails — the question of delegation.
Harmonizing Tax Frontiers: OECD’s Soft Law in International Taxation and Its Effect on the EU Legal Order
Franklin Cachia explores the role of OECD soft law in shaping international taxation within the EU legal order, emphasizing its dual effect on harmonization and national sovereignty.
Australian Government Will Tax Digital Assets Under Existing Laws
The Australian government will not introduce new tax legislation focused on cryptoassets, but will continue to evaluate the need for decentralized finance rules following the Board of Taxation's recommendations.
Ireland Announces Tax Revenue Analysis Amid U.S. Tariffs
The Ireland Department of Finance issued a release announcing the publication of an Irish tax revenue analysis in relation to the widespread U.S. tariff policies, noting that the paper does not take into account windfall corporate tax receipts from the last few fiscal years, which could mean that the need to protect Irish public finances is higher than the paper estimates.