2023

Nana Ama Sarfo describes the African Tax Administration Forum's suggested approach to QDMTTs and their potential importance for African countries.

As countries implement global minimum tax rules, it might be time to consider changing or eliminating potentially duplicative anti-tax-avoidance measures, like controlled foreign corporation rules, an OECD deputy tax chief said.

President Biden and British Prime Minister Rishi Sunak announced plans to reach a deal on critical minerals that will allow U.K. auto manufacturers to at least partially qualify for the clean vehicle tax credit included in the Inflation Reduction Act.

Speaking on June 7 at a Texas Federal Tax Institute conference, Tracy Villecco of the IRS Office of Associate Chief Counsel (International) said the government is open to hearing comments on a fact pattern “where the withholding payment on a service payment is in respect to services performed within that source jurisdiction, similar to the single-country exception for royalties.”

Leaders from OECD member countries pledged to help developing countries implement the two-pillar plan to modernize corporate tax rules while calling on the OECD to aid those countries in introducing country-by-country reporting rules.

The Norwegian Ministry of Finance has presented for consultation a proposal that would implement global minimum tax rules in line with pillar 2 of the OECD’s two-pillar plan to modernize corporate tax rules.

European Commissioner for Competition Margrethe Vestager said that taxing bad behavior is more efficient than rewarding good behavior for achieving clean energy goals, but sometimes subsidies are necessary to support innovation.

Mindy Herzfeld explores how tax incentives might evolve in response to the OECD two-pillar deal.

The African Union is seeking ways to protect its member countries’ tax bases, including adopting domestic minimum top-up taxes and formulating a common position to help shape the U.N. debate on international tax cooperation.

Three corporate groups accounted for about one-third of Ireland’s total corporate tax revenue, with contributions amounting to EUR 5.2 billion in 2021, according to Ireland’s fiscal watchdog.

The International Accounting Standards Board is seeking input on proposed temporary accounting relief for deferred taxes for small and medium-size enterprises in response to OECD-brokered pillar 2 global minimum tax rules.

Japan plans to use tax incentives to stimulate investment in its semiconductor industry, as well as biotechnology, storage batteries, and data centers. The move is part of Prime Minister Fumio Kishida's "new capitalism" agenda.

The Dutch government has presented to parliament a bill that would implement global minimum taxation as required under pillar 2 of the OECD’s two-pillar deal to modernize corporate tax rules.

A U.S.-Chile tax agreement was approved by the Senate Foreign Relations Committee, advancing it to a full Senate vote. The treaty with one of the world’s largest lithium producers, which was negotiated in 2010, is considered important for the U.S. manufacture of semiconductor chips.

The New York State Bar Association Tax Section has submitted a report to the U.S. Treasury Department and the IRS regarding foreign tax credit considerations related to the OECD’s pillar 2 model rules, discussing considerations raised by pillar 2 taxes under the current IRS section 901, section 904, and section 960 rules; raising policy considerations for granting a credit for those taxes; and recommending related guidance.

Benjamin Angel, director of direct taxation at the European Commission’s Directorate-General for Taxation and Customs Union, said that the removal of a proposal to address tax avoidance enablers from the European Commission’s agenda should not be overinterpreted.

Stellantis could receive C$19 billion in subsidies from the Canadian government for a new electric vehicle battery plant. Canada is competing with the US to attract production of battery cells after President Biden signed the IRA.

Mindy Herzfeld examines how actions taken by countries in South America and the Caribbean, and the treaties that bind them, could undermine the OECD two-pillar deal’s promise of international tax stability.

A law aimed at shell companies is stalled due to disagreements between EU member states. Some want it to require sanctions against tax-avoiding shell structures while others want it to be downgraded to an "exchange of information" system.

Vietnam is considering compensating foreign investors for higher levies set to take effect next year under the global tax deal.

The EU is planning a directive for Pillar One similar to what was adopted for Pillar Two, and the framework is expected to be in place by July. An EU official said the move will catalyze a “political mass” for adoption of Pillar One at the international level.

Zimbabwe is introducing a 1% tax on all foreign payments made in the country to help the government stabilize the economy and raise revenue to pay for foreign-currency denominated debt.

Switzerland is seeking input on a proposal to minimize the administrative burden for multinational enterprises with business units across multiple Swiss cantons under a new supplementary tax regime aligned with OECD global minimum tax rules.

The European Commission said in its country-by-country economic recommendations that aggressive tax planning in Luxembourg and Malta is still of concern, particularly regarding withholding taxes on outbound dividend, interest, and royalty payments.

The IASB has published final amendments to a key standard providing temporary relief from deferred tax accounting in response to worldwide adoption of OECD-brokered global minimum tax rules.

The leaders of the G-7 countries are still aiming to quickly conclude talks on a multilateral convention that would implement pillar 1 of a two-pillar global corporate tax reform plan, according to their latest communique.

The Australian Taxation Office is soliciting comments on draft guidelines for its compliance and risk assessment framework on intangible arrangements between international related parties, revising a version from 2021.

Republicans lawmakers in the U.S. are criticizing the OECD's global minimum tax proposal and may try to impose a reciprocal tax on countries implementing an undertaxed profits rule or similar taxes.

Guernsey, the Isle of Man, and Jersey have confirmed that they will implement OECD-backed income inclusion rules and domestic minimum taxes, beginning in 2025, to ensure that large multinationals pay a 15 percent effective tax rate.

The Bahamas is seeking stakeholder input on possible options for a new corporate income tax regime to support its implementation of global minimum tax rules under the OECD’s two-pillar international tax reform plan.

Mindy Herzfeld examines whether a multilateral economic arrangement that fails to fully consider how and whether the world's second largest economy will participate can truly bring stability to the international tax architecture, and how China's role in the deal might affect other countries' tax revenue and their economic competitiveness.

An official from the African Tax Administration Forum said African countries must adopt minimum tax legislation to avoid losing corporate revenues under the global tax deal. They can use a domestic minimum top-up tax to get first rights to tax companies in their jurisdictions at the 15% minimum rate.

The Kiwi government has presented draft legislation to implement global anti-base-erosion (GLOBE) rules under pillar 2 of the OECD’s two-pillar tax reform plan beginning next year, but the new rules will not raise much revenue.

A U.S.-Chile tax treaty is moving closer to a Senate vote after lawmakers worked out concerns over language on foreign tax credits. The pact was signed in 2010 but has not yet been approved by the Senate.

The IRS has confirmed its willingness to work on intricate transfer pricing disputes between multinational corporations and tax authorities, despite speculation that it would not.

France’s government has proposed tax credits and other initiatives to take advantage of relaxed EU state aid rules intended to allow the bloc to compete with the United States and transition to a greener economy.

Itai Grinberg, a former Treasury deputy assistant secretary for multilateral tax, warned that the United States will be under pressure to conform with OECD global minimum tax rules in 2025, but domestic political headwinds against those rules will make that task a challenge.

The UK’s Chancellor of the Exchequer says tax cuts are not a priority at the moment, as the government's focus is on reducing inflation and maintaining the UK’s credibility with financial markets.

Swedish shipowners have warned the Swedish government that the EU global minimum tax directive’s international shipping income exemption is inconsistent with EU tonnage tax regimes, echoing concerns underpinning a recent legal challenge against the directive.

Countries are making good progress in adopting OECD-brokered global minimum tax rules but need more advice from the OECD to ensure conformity in their efforts, according to G-7 finance ministers and central bank governors.

EU finance ministers have provisionally agreed on a rule that would require crypto-asset service providers to report transactions of their EU clients to tax authorities starting in 2026. The rule is part of the EU's efforts to track crypto transactions and ensure related taxes are paid.

According to the OECD’s new tax head Manal Corwin, the text of a multilateral convention that would implement pillar 1 of a two-pillar global corporate tax reform plan will be ready by the summer as planned.

On May 12, the Biden administration released rules that will determine which companies and manufacturers can benefit from new solar industry tax credits. These rules are being criticized by U.S.-based makers of solar products, who say the guidelines do not go far enough to try to lure manufacturing back from China.

The OECD is developing an approach to allow confidential discussions between tax administrations and taxpayers in support of a two-pillar global tax reform plan and expects it to be operational next year.

Republican senators derailed a May 11 hearing meant to address American pharmaceutical companies’ low effective tax rates with complaints about U.S. participation in OECD pillar 2 international tax talks.

The Brazilian Senate has approved a proposed overhaul of the country’s transfer pricing system to coordinate its tax regime with international principles, and the law is expected to be enacted in the next few weeks.

Irish Finance Minister Michael McGrath has floated depositing up to €90 billion in excess corporate tax receipts into a new sovereign wealth fund over the next seven to 12 years. According to a May 10 scoping paper, Ireland is considering three scenarios in which it deposits anywhere between €34 billion and €90 billion in windfall corporate tax receipts into a new sovereign wealth fund established to enable it to deal with the economic risks of its aging population.

Australia has confirmed its intention to implement domestic minimum tax and global anti-base-erosion (GLOBE) rules that will start taking effect in 2024, in line with pillar 2 of the OECD’s two-pillar international tax reform plan.

A company has filed an application with the General Court of the European Union contesting the validity of the EU global minimum tax directive’s international shipping income exemption. A summary of the application that was published on May 8 argued that the court should annul the exclusion under Council Directive (EU) 2022/2523 and order the Council of the European Union to cover the costs of the procedure.

President Biden’s climate law appears to be encouraging more investment in American manufacturing than initially expected. This boom in new economic activity is driving up costs for taxpayers, who are subsidizing the investments.