Int'l Tax News

A year into the Trump administration’s global tariff campaign, many companies are still struggling to coordinate their trade functions with their tax and transfer pricing teams, risking messy audits in the years to come.

The article reports on Turkey’s proposed tax package to attract foreign investment, regional operations hubs, exporters, and high-net-worth immigrants. The proposal would provide major corporate tax exemptions for qualified service centers, reduced tax rates for export income, a long-term foreign-source income exemption for qualifying new residents, and an amnesty for funds transferred into Turkish financial institutions.  

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The article examines European and business concerns over California A.B. 1790, which would phase out the water’s-edge election and require worldwide combined reporting for multinational corporations doing business in California. Mandatory worldwide combined reporting could lead to double taxation, increased compliance burdens, and foreign government objections by applying California’s formulary apportionment system to global corporate income.  

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The article reports that Portugal plans to propose a windfall tax on energy companies that have benefited from higher prices linked to the Iran war. The proposal builds on Portugal’s 2022 excess profits tax and follows unsuccessful efforts by Portugal and other EU countries to push the European Commission toward an EU-wide energy-sector windfall tax. The article shows how governments are reviving excess profits taxation as a national fiscal response to geopolitical shocks, energy price volatility, and public pressure over corporate gains during crises.

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The article reports that Switzerland is considering delaying the application of OECD Pillar 2 guidance on deferred tax assets from tax years beginning in 2024 to tax years beginning in 2025. The guidance affects how preexisting deferred tax assets tied to government arrangements or new corporate tax regimes are treated in effective tax rate calculations under the GloBE rules and Switzerland’s qualified domestic minimum top-up tax.

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The article examines how FIRPTA’s treatment of intangible rights remains unclear for transportation infrastructure projects, even as foreign investment in AI-related data centers and supporting infrastructure becomes increasingly important. Yu argues that while recent FIRPTA reforms and REIT structures provide clearer treatment for data center investment, foreign investors in public-private transportation concessions still face uncertainty over whether operational permits, licenses, and tolling rights constitute U.S. real property interests.  

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The European Union wants the main parts of a US trade deal adopted by July, as it pushed Washington to respect previous commitments made under the pact.

The article discusses disagreement among EU member states over whether windfall taxes on energy companies should be imposed at the EU level or left to national governments. Germany, Austria, Portugal, and Spain supported an EU-wide approach, while the Eurogroup president emphasized that taxing windfall profits remains a national policy decision that must take into account energy security, supply chains, and infrastructure investment.  

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The article examines renewed calls for a windfall profits tax on oil and gas companies following price increases tied to conflict in Iran. It discusses the political and practical difficulties of imposing sector-specific taxes, including concerns about revenue generation, energy markets, and long-term investment incentives. 

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The article criticizes Germany’s Federal Central Tax Office for denying treaty-based withholding tax relief to U.S. investors in German entities treated as fiscally transparent under the U.S. check-the-box rules. The authors argue that Germany’s position misapplies Article 1(7) of the Germany-U.S. tax treaty by focusing on the classification of the German payer rather than whether the income is taxed at the U.S. resident level.  

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AI is changing the practice of tax law. This series examines China’s Golden Tax IV system, powered by Big Data and AI, is actively rewriting the rules of tax enforcement—intensifying audits with a precision that increasingly catches companies off guard. 

Professor Herzfeld examines the first reporting season under FASB’s expanded income tax disclosure rules. The article highlights that the new disclosures provide greater detail regarding companies’ federal, state, foreign, and jurisdiction-specific tax payments. The article connects financial accounting disclosures to broader debates over income tax policy and examines the impact of FDII, research credits, energy credits, Pillar 2, foreign tax rules, and other statutory incentives on corporate effective tax rates.  

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The article contrasts Reform UK’s proposed tax cuts with the Green Party’s wealth tax and previews how smaller parties might influence tax debates. Reform UK’s platform emphasizes lower taxes on businesses and individuals, while the Green Party would shift more of the tax burden onto wealth, capital gains, and high-income taxpayers. 

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The article analyzes how remote, hybrid, and digital nomad work, as well as employer-of-record models, create new tax challenges, including those related to personal income tax, permanent establishment, profit attribution, and transfer pricing. The authors argue that existing treaties and OECD frameworks assume traditional work patterns, leading to uncertainty over presence tracking, withholding, PE risk, and profit attribution for home-office PEs.  

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Rising energy profits have renewed debates over windfall taxes in Europe and beyond. This article examines how governments consider taxing extraordinary gains in globally integrated industries. It reflects broader tensions between revenue generation, investment incentives, and international competitiveness.

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A Treasury rule is allowing companies like Meta and Qualcomm to claim billions in tax benefits, highlighting how regulatory changes can significantly affect the taxation of multinational income. The development raises questions about how cross-border earnings are classified and the extent to which Treasury guidance shapes corporate tax outcomes. 

This article looks at the current state of U.S. tariffs after a Supreme Court decision struck down parts of earlier trade measures. It explains how the administration is adjusting tariff policy across different trading partners and industries.

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The revised global minimum tax agreement puts EU companies at a competitive disadvantage compared to US firms, a key European parliamentary committee says. See the EU Parliament report.

The European Parliament called for digital services taxes and levies on online gambling and crypto assets if needed to strengthen the EU’s revenue streams.

The OECD’s global minimum tax was billed as a landmark change to curb corporate tax avoidance. A 15% effective tax rate on multinational groups with revenues over €750 million ($883 million) was supposed to reduce the advantages of shifting profits to low-tax jurisdictions.

Recent shifts in US tariff policy may add $1.1 trillion to federal budget deficits over a 10-year period, though exact calculations aren’t yet possible, according to the director of the nonpartisan Congressional Budget Office.

Expenditure-based investment tax incentives can provide more value for money than income-based incentives and should be considered by policymakers as the basis for new incentive design, the OECD said. See OECD Guide to Investment Tax Incentives

Teaser: The article discusses the European Commission’s warning that OECD pillar 2 simplification efforts must remain compatible with the EU pillar 2 directive because there is no short-term plan to amend the directive. Additional simplification may be possible through safe harbors, but only if those safe harbors fit within EU law, including Article 32 and the framework used for the U.S. side-by-side package.

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The growing web of circular deals among billion-dollar companies funding AI’s explosive growth is feeding investor worry about a massive bubble. For corporate tax departments there’s another concern, maybe unrecognized: the risk of transfer pricing regulation.

The UK government defended its digital services tax as an appropriate measure for taxing businesses in the wake of fresh tariff threats from the Trump administration.

This article examines the aftermath of invalidated U.S. tariffs and the government’s refund process, highlighting how repayments are directed to businesses rather than consumers who bore much of the economic burden. It raises important questions about the incidence of tariffs and the distributional consequences of trade policy.

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The article argues that the original policy justifications for the U.K. digital services tax have weakened because BEPS reforms, U.S. international tax changes, and the implementation of pillar 2 have substantially changed how large digital multinationals report and pay tax. It criticizes the DST as an extraterritorial gross-receipts tax that functions more like a tariff or back-door VAT, creating trade friction with the United States while sitting uneasily with treaty-based income tax principles.

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Failure to find a multilateral solution on the taxation of the digital economy would make fresh regional or unilateral measures “almost unavoidable,” a senior European Commission official said.

The European Commission’s coming tax simplification package will reduce the administrative burdens on companies that have signed up to the global minimum tax deal, a top official said.

This article explores how geopolitical conflict is influencing tax policy debates in Australia, particularly regarding the taxation of natural resource exports. It focuses on whether current tax regimes adequately capture revenue from multinational energy companies.

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President Donald Trump sent what might be construed as a chilling message to the thousands of American importers applying this week for refunds for his illegal tariffs: In his eyes, you might fare better if you don’t.

Countries involved in international tax talks at the OECD are working to develop permanent tests to ease compliance with the global minimum tax, a US Treasury official said.

The article says the European Commission cannot estimate revenue losses from the pillar 2 deal and notes that the global minimum tax aims to limit tax competition, not raise revenue. It also addresses member state requests for delays, possible simplifications to tax directives, and challenges in adapting dispute-resolution mechanisms for pillar 2 cases involving non-EU countries.

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EU countries are poised to approve a bill giving the bloc’s anti-fraud agencies access to tax data after amendments were added to ensure privacy rules.

Teaser: An OECD official said the pillar 2 side-by-side package will likely not be reversed at the 2029 stock-take. This means special treatment for U.S.-parented multinationals may remain in global minimum tax rules.  

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Brazil’s tax authority seeks comments on draft changes to its domestic top-up tax to adopt the OECD Pillar 2 safe harbor. The top-up tax could drop to zero for qualifying incentives, up to a limit based on payroll, depreciation, or eligible assets. This aligns Brazil's rules with the OECD, while preserving space for tax incentives under the global minimum tax.

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Teaser: Luxembourg's tax administration will apply the OECD’s Amount B simplified transfer pricing approach to treaty jurisdictions. For in-scope marketing and distribution, Luxembourg may refrain from adjusting pay, provide a matching adjustment, or use MAP relief. This supports the political commitment, aims to reduce the risk of double taxation, and to improve certainty.

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This article analyzes the implementation of the tariff-refund process following the Supreme Court’s invalidation of key U.S. tariffs. It highlights administrative uncertainties, compliance challenges for importers, and the broader implications for trade enforcement and revenue recovery. The piece is particularly relevant for understanding how tariff measures function as tax-like instruments and how their reversal affects cross-border transactions and regulatory practice.

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Countries are leaning toward further engagement in digital tax talks, a top OECD official said.

Brazil is awaiting OECD action on its request for exemption from key parts of the global minimum tax framework, following a similar carve-out secured by the US for its multinationals.

The OECD is working on guidance this year that would aim to prevent companies from abusing new global minimum tax rules, a top official said.

The next five years are crucial in preserving progress on multilateralism, a top OECD official said as she laid out the case for further global tax cooperation after January’s landmark minimum-tax deal.

Countries involved in global tax talks at the OECD are developing a process to determine whether jurisdictions have appropriately applied the global minimum tax rules into their local laws.

Recent changes to the global minimum tax framework still give countries ample latitude to offer multinational companies beneficial tax incentives, an OECD official said.

The European Union needs to be more ambitious in its aims to simplify rules for businesses, including by reforming the bloc’s tax system, according to Ludovit Odor, a European representative from Slovakia.

Professor Herzfeld examines the United States’ withdrawal from United Nations tax negotiations, contending that while U.S. objections to the process are valid, nonparticipation diminishes its capacity to influence the development of international tax norms. Herzfeld further explains that the U.N.’s framework convention initiatives, the Sevilla commitments, and the Tax Committee agenda collectively promote a shift toward greater source-based taxation, particularly regarding cross-border services, digital activities, and permanent establishment rules. This positions the U.N. tax project as a significant competitor to the OECD-centered system and suggests that continued U.S. nonparticipation may weaken dispute resolution mechanisms, deter foreign direct investment, and erode long-term U.S. economic influence abroad.

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Iran’s proposal to impose transit fees on vessels passing through the Strait of Hormuz reflects a broader historical pattern of states attempting to monetize control over key maritime chokepoints. The article traces similar practices from Ottoman and European regimes, highlighting how tolling waterways has long been tied to assertions of sovereignty and economic leverage. The current situation raises significant questions under international maritime law, particularly regarding the legality of charging fees for passage through straits used for international navigation, and underscores the geopolitical and economic risks such measures pose to global energy markets and shipping.

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