2026

Singapore projects increased corporate tax revenue from the fiscal year 2027 as it implements the OECD pillar 2 regime through an MNE top-up tax and a domestic top-up tax. Officials emphasized that while the 15% minimum rate will boost collections, Singapore must expand targeted incentives to remain competitive in a reshoring environment. The 2026 budget pairs minimum-tax compliance with measures such as a 40% corporate income tax rebate and enhanced internationalization and innovation incentives.

Poland is consulting on a proposed 3% digital services tax targeting large multinationals with significant global and Polish revenue thresholds. Stakeholders raised concerns about competitiveness, administrative complexity, enforceability, and possible U.S. retaliation, while the finance ministry reportedly remains cautious about alignment with international tax commitments. Inclusion in the government’s legislative agenda will determine whether the DST advances toward parliamentary debate in 2026.

The authors argue the U.S. refusal to restore a functioning WTO appellate system amid DST disputes is a rational response to asymmetric litigation risk, not hypocrisy. They contend that any U.S. challenge to foreign DSTs could invite counterclaims targeting U.S. tax provisions such as FDII and IC-DISC as prohibited export subsidies, which are easier to attack under WTO doctrine than DSTs. The piece frames DST conflict as a structural tax-trade mismatch, in which U.S. corporate tax incentives may be more legally vulnerable than the DSTs the United States opposes.

The OECD’s Forum on Harmful Tax Practices released updated peer review findings under BEPS Action 5, assessing preferential regimes and substantial activity requirements. Ireland and Peru were found not to have harmful regimes, while Fiji abolished two incentive regimes, and Anguilla and the Turks and Caicos Islands were flagged for follow-up. The report reflects ongoing multilateral monitoring and pressure to align domestic regimes with substance and transparency standards.

PwC told Dutch lawmakers that the pillar 2 “side-by-side” safe harbor could prompt multinationals to shift their headquarters, R&D, or other high-value functions out of the Netherlands, thereby threatening the corporate tax base. It urged policymakers to consider competitiveness responses, such as lowering the corporate rate, redesigning innovation box incentives to align with the substance-based safe harbor, or using Article 11 of the EU Pillar 2 directive to opt out of the domestic top-up tax. The warning reflects broader EU tensions between minimum-tax coordination and national competitiveness strategies, as pillar 2 begins to influence location decisions.

Senate Democrats introduced the Stop Corporate Inversions Act to restrict further transactions that move a company’s tax residence abroad through acquisitions of smaller foreign corporations. The proposal signals renewed appetite to tighten the inversion rules and reinforce §7874-style constraints as part of a broader anti-base-erosion agenda. If enacted, it could narrow viable outbound restructuring paths and increase the tax friction of cross-border M&A involving U.S.-parented groups.

Rep. Moran’s proposal would deny major federal business tax incentives to companies that use technology controlled by foreign entities of concern, tying tax eligibility to national security and data-risk considerations. The bill would effectively convert credits and incentives into a compliance lever for supply chain and technology governance, potentially affecting planning in manufacturing and tech-heavy sectors. It reflects a broader trend of using tax policy to advance geopolitical and cybersecurity goals, adding another layer of constraints to incentive-driven investment decisions.

Commissioner Wopke Hoekstra said pillar 2 has “deteriorated” and pillar 1 remains stalled, but he is not ready to push an EU-wide digital services tax and wants to exhaust options to preserve the two-pillar project. He argued that an EU DST would be politically and technically difficult because DST countries would push their existing models, while other member states would demand trade-offs. Hoekstra also defended the Commission’s 2026 withdrawal of several stalled tax proposals (including DEBRA, Unshell, and a transfer pricing directive) while keeping older DST and “significant digital presence” proposals available as leverage.