2026

Three large banks, Banco Citibank SA, Itaú Unibanco, and Banco Santander Brasil, reportedly paid about BRL 2.4 billion, around $457 million, to settle Brazilian tax disputes, with average discounts of about 21 percent on interest and penalties. The settlements reportedly covered disputes involving Brazil’s former financial transactions tax for Santander and Citibank, and PIS and COFINS-style social contributions plus income tax and the social contribution on net profit for Itaú. The piece shows how Brazil uses settlement programs to close contentious assessments by discounting add-ons such as interest and penalties, and it underscores the real cash costs and compliance risks multinationals face in Brazil’s financial sector.

Semer argues that the Treasury’s December 15, 2025, final and proposed section 892 regulations would significantly restrict how foreign sovereign investors can invest in the United States while keeping the section 892 exemption. He says the rules could treat routine lending and credit activity, and even standard minority protection governance rights, as disqualifying commercial activity or effective control. The result, he argues, is a policy contradiction where rules meant to police abuse could make sovereign capital harder and more expensive to attract, forcing funds and deal parties to rethink loan terms, veto rights, and compliance planning under section 892.

An EU Commission official says member states are divided on cross-border remote work, and businesses warn that unclear tax rules are changing hiring and investment decisions across the single market. Companies cite permanent establishment and broader corporate tax exposure as the main problem, with some limiting remote work or hiring to avoid creating nexus through employee presence. The piece frames this as a live administration challenge at the intersection of PE standards, corporate residence, and withholding and payroll compliance, with implications for the EU’s simplification and competitiveness agenda. 

Two Dutch tax practitioners say the Netherlands should apply for the OECD Pillar Two side by side safe harbor, arguing its system is already closed because of the 25.8 percent corporate rate, a domestic top up tax, and strong antiavoidance rules. They frame it as a competitiveness and compliance burden move, warning the Netherlands could face maximum hassle and minimum revenue if it implements Pillar Two without safe harbor protection, especially after the Inclusive Framework’s January 5 deal shielding U.S. groups from IIR and UTPR. They also stress timing, noting the OECD will review regimes on request by the end of the first half of 2026, while Dutch politics have not clearly committed to applying despite parliamentary pressure and potential state aid concerns.

Sheppard argues the OECD’s “side-by-side” safe harbor is an imperfect near-term fix for U.S. multinationals because it does not eliminate QDMTT exposure and may not meaningfully reduce ongoing Pillar 2 compliance. Until countries actually enact and implement the law, U.S. groups may still need to book and compute current IIR/UTPR exposure for financial reporting purposes. The piece also flags structural frictions, including the lack of a QDMTT “push-down” and continued reliance on complex book-income adjustments and elections, suggesting the safe harbors are a band-aid on a flawed framework. 

Herzfeld argues that even as governments negotiate formal fixes like the Pillar 2 side-by-side safe harbor, many multinationals face opaque foreign audit practices that operate more like “pay-to-play” pressure than predictable rule-of-law enforcement. Herzfeld critiques OECD peer reviews for failing to identify real barriers to MAP and highlights the need for tougher enforcement and penalty tools in jurisdictions such as France, Italy, Mexico, and Australia. Herzfeld suggests responses including enhanced U.S. disclosure of foreign audit activity and a more reality-based peer review that incorporates taxpayer experience. 

The European Commission opened infringement proceedings against 14 EU member states for failing to fully transpose DAC8 (cryptoasset tax transparency) and/or DAC9 (pillar 2 reporting) by the December 31, 2025 deadline. The action underscores the EU’s growing emphasis on enforcement of tax transparency and global minimum tax reporting as core elements of its anti–tax avoidance agenda. The article focuses on uneven national implementation of pillar 2–related obligations, with potential escalation to the Court of Justice if member states do not respond satisfactorily.