Int'l Tax News

In its economic outlook report, the OECD cautioned member and some nonmember countries against introducing and keeping broad-based tax cuts and subsidies for fossil fuels and instead recommended that countries should increase tax revenues by either broadening their tax bases or raising their tax rates.

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Denmark's new government is launching sweeping tax reforms, highlighted by a new tech tax targeting global tech giants and a corporate income tax cut from 22% to 19% to boost business competitiveness. The plan also features temporary household electricity tax cuts that recently drew praise from the European Commission for promoting electrification.

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Latif explores the difficulties developing economies face with the international structure for cross-border tax disputes and describes solutions through the work of the U.N. Framework Convention on International Tax Cooperation.

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The European Commission pushed Luxembourg and Malta to strengthen measures against aggressive tax planning, warning both countries they’re susceptible to companies shifting profits to low-tax jurisdictions.

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US officials should ensure countries at the OECD don’t further complicate the global minimum tax rules and target US companies, a business group urged the Treasury Department in a letter released Wednesday. The Alliance for Competitive Taxation expressed concern about the Organization for Economic Cooperation and Development’s plans to release “integrity” guidance under the global minimum tax following a deal struck by countries Jan. 5 that would carve out US companies from parts of the minimum levy’s framework.

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The EU's ECON committee is voting on a 28th tax regime proposal aimed at helping cross-border startups by creating a unified tax base and letting them offset losses across borders. They might launch it with a smaller group of member states if they are unable to get all members to agree.

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The OECD released a draft proposing a substantial revision of its transfer pricing guidelines on intro group services, the first major overhaul since 2015. While it does not offer the arm’s-length principle, it provides more guidance on how taxpayers and tax administrations should analyze those services and provides practical examples in the annex. 

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The EU is drafting a massive tax package that could save companies about €5.3 billion a year by completely scrapping minimum holding requirements for withholding tax exemptions on intra-EU dividends, interest, and royalties. It also simplifies cross-border dispute resolutions, though some member states might fight it since it could erode their local tax revenues.

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As global minimum tax compliance goes live, jurisdictions are rapidly rolling out critical administrative updates. Belgium has officially finalized its 2024 QDMTT return template and extended key filing deadlines, while Australia, Ireland, Italy, Malaysia, Portugal, South Africa, and Sweden have dropped urgent guidance covering account setups, GIR filing portals, safe harbors, and penalty relief.

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The European Commission is set to transform the Anti-Tax Avoidance Directive (ATAD) into a broader competitiveness framework featuring a new harmonized R&D allowance. The leaked draft omnibus proposal also aims to slash corporate compliance costs by introducing mandatory interest limitation relief and a sweeping Controlled Foreign Company (CFC) rule exemption for Pillar 2 groups and SMEs.

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Malherbe and Strauven examine the conditions that have prompted a newly proposed Belgian digital services tax.

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Herzfeld examines the EC’s new foreign subsidiaries regulation, including how the commission has wielded the regulation as part of its broader state aid efforts and implication for U.S. companies.

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The EC has started evaluating alternatives for the EU budget such as a digital services tax. The DST would target digital services, online gambling, and cryptoassets and could raise €5 billion annually.

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In the final installment of a four-part series, Gribinski offers examples demonstrating how the proposes autonomous AI nexus system would work.

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In the first installment of a three-part series, Levine explores the reasons behind Europe’s struggles to foster world-class technology companies despite its world-class scientists and engineers.

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Ten EU countries are aiming to sign an agreement by the end of the year to create a cross-border tax dispute resolution commission that would improve the speed and efficiency of mutual agreement procedures.

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A higher share of non-US tech companies paid the UK’s digital services tax in 2025-26, even as the levy remains a flash point in trade tensions between Washington and London.

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The Treasury Department and the IRS moved Friday to address concerns that sovereign-wealth funds and other foreign-government investors in the US could be penalized by new regulations on when their US investment income is exempt from US taxation.

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The European Commission is proposing a raft of exemptions from certain taxes and rules to headline the bloc’s corporate tax reform aimed at making it easier to do business.

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Since the beginning of 2025, the Trump administration withdrew from a global effort to curb offshore tax-dodging by multinational companies. As a result, U.S. companies skirted at least $40 billion in taxes since then to schemes in places like Malta, Bermuda and Cyprus.

Following the Trump administration withdrawal from global effort to curb offshore tax-dodging by multinational companies since the beginning of 2025, U.S. multinationals have circumvented an estimated $40 billion in taxes in places like Malta, Bermuda and Cyprus.

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Sarfo describes the plans of the new head of the OECD’s Global Forum on Tax Transparency, Maria José Garde, which include implementation of the Crypto-Asset Reporting Framework (CARF) and expanding transparency into real estate, and exploring how AI can safely help tax administrations analyze massive volumes of exchanged financial data.

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The GLOBE consolidated commentary was updated on May 28 and builds on previous version issues in May 2025. Important elements of this package include the side-by-side safe harbor, the ultimate parent entity (UPE) safe harbor, the simplified effective tax safe harbor, the substance-based tax incentive safe harbor, and the one-year extension of the country-by-country reporting safe harbor.

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Panama’s National Assembly approved a 15% tax on the passive income of locally domiciled multinational entities that fail to demonstrate real economic activity. The bill also modernizes Panama’s concept of permanent establishment in accordance with international standards, introduces an anti-abuse clause, and reinforces guarantees regarding the confidentiality and protection of tax information. Panama hopes that this will remove it from the EU’s grey lists of noncooperative tax jurisdictions. 

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Several non-OECD countries believe the U.N. tax convention contains critical gaps in its approach to tackling harmful tax policies and push for developing a fairer international tax system to address these harmful tax practices. Some leaders believe that progress on the U.N. tax convention have slowed with the exit of the U.S. from U.N. talks. 

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Two Dutch academics see constitutional and state aid problems arising from the EC’s implementation of the side-by-side safe harbor. This safe harbor, which exempts corporate groups from the income inclusion rule and undertaxed profits rule if they are headquartered in a qualifying jurisdiction (U.S. is the only jurisdiction with this status), is believed to allow a non-EU body to write EU law. 

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Gomes examines how pillar 2 has altered tax incentives for multinationals under the effective tax rate model of the global anti-base-erosion rules.

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An OECD report published Wednesday concluded that corporate income tax regimes can disproportionately disadvantage younger and smaller businesses by favoring larger multinational enterprises with greater tax planning capacity and access to specialized compliance resources. The report also raises questions about whether current international tax frameworks adequately balance revenue collection objectives with the need to support market entry and growth among smaller firms operating in increasingly globalized markets.

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An Irish digital infrastructure group warned that delays in expanding data center and energy capacity could threaten Ireland’s corporate tax base by prompting multinational technology companies to relocate intellectual property and future investment elsewhere.

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Private equity-backed companies are seeking exemptions from proposed UK tax reporting rules for “close companies,” arguing the measures were designed for small closely controlled businesses rather than large investment-backed corporate groups. The proposal highlights how technical ownership rules can inadvertently expand compliance obligations for multinational investment structures and private funds. The debate also reflects broader tensions between tax transparency initiatives and the administrative burdens imposed on complex cross-border corporate ownership arrangements.

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European countries are increasingly participating in United Nations negotiations aimed at expanding developing countries’ ability to tax remote and digital businesses, reflecting growing dissatisfaction with stalled OECD digital tax discussions and declining confidence in US cooperation. The negotiations center on replacing traditional physical presence standards with broader taxing rights over multinational enterprises operating digitally across borders.

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The OECD blog explains how cross-border remote work may affect whether an employer has a taxable presence in another country under Article 5(1) of the OECD Model Tax Convention. It highlights the November 2025 OECD Model Commentary updates, which clarify that an employee working from home abroad does not automatically create a permanent establishment, especially where the arrangement is part-time or driven by personal preference rather than business necessity. 

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The Streaming Innovation Alliance called on U.S. lawmakers to pass legislation would support an investigation in Canada’s Online Streaming Act. The lobbying group believes that the taxes imposed under OSA are discriminatory and constitute and urgent and growing threat to American streaming companies.

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In the third installment of a four-part series, Gribinski introduces his proposed autonomous AI nexus model.

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A partial draft of the U.N. tax convention provides that some countries may need to interpret, apply, and renegotiate existing tax treaties and related agreements to fulfill their obligations under the U.N. convention. Several countries including Germany, Norway, and Sweden voiced objections to the renegotiation of existing agreements, arguing they are inconsistent with principles of the fair allocation of taxing rights. The draft also includes articles 15, 17, and 19, which deal with the convention’s interaction with other international agreements and procedural matters.

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Lobbying group BusinessEurope asked California Gov. Gain Newsom (D) to prevent a draft bill introducing worldwide combined reporting for multinational businesses to reemerge during budget negotiations. Believing this bill would risk risks double taxation, disproportionate compliance burdens, and cross-border tax disputes, BusinessEurope urges Newsom to strike the bill.

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Swiss officials warned that the OECD’s revised global minimum tax framework may reduce Switzerland’s competitiveness for attracting US multinationals because companies could relocate to jurisdictions that have not implemented comparable minimum tax rules.

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A U.S. court administratively closed a lawsuit filed by a Texas-based Sabre GLGL claiming that British Airways refused to compensate it for the U.K.’s digital services tax. The DST requires payment of 2% on “the revenues of search engines, social media services, and online marketplaces which derive value from U.K. users.” Whether British airways was required to reimburse Sabre  depends on whether DST applies to Sabre’s services under U.K. law, which the judge believed is best determined in a U.K. forum. A  resolution of these issues has significant implications for how a digital services tax is treated under U.K. law and may provide guidance to how similar tax provisions will be treated.

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G7 anticipates an OECD report by the end of 2026 on counties’ progress on identifying common challenges linked to taxing the digital economy. Separately, G7 ministers issued a declaration reinforcing actions to promote domestic resource mobilization and public financial management in partner countries.

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Herzfeld describes the recent phenomenon of companies are looking to bring their operations back to the U.S., as well as various challenges companies may face in their attempt to domesticate in the U.S.

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In the second installment of a four-part series, Gribinski explains the shortcomings of reforms targeting the digital economy when applied to autonomous artificial intelligence.

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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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