Swiss to See More Than $600 Million Under Global Minimum Tax
Switzerland is set to generate more than CHF 530 million ($600 million) in additional tax revenue in the first year under a 15% minimum tax rate, according to an update from the Swiss Federal Department of Finance.
Debunking 5 Republican Arguments Against the Global Minimum Tax
Republicans oppose the global minimum tax, arguing that it would hurt American businesses and workers and that it would violate the Constitution. Proponents dismiss these claims, arguing Republicans oppose the tax because they want to help corporations get to the lowest tax rate possible, even at the expense of the federal budget, other taxpayers, and the ability of governments worldwide to build fair and efficient tax systems.
Canada Consults on New Pillar 2 Legislation, Revised DST Bill
The Canadian Department of Finance is seeking public input on new draft legislation that would implement OECD global minimum tax rules and on an amended bill providing for a controversial digital services tax.
Canada Moves Forward With New Tech Tax
On August 4, Canada released an explanatory note about the Digital Services Tax Act, which goes into effect as soon as January. It is a 3 percent tax on the revenues of large technology companies, including those with online marketplaces, like Walmart and Amazon, and social media platforms, like Meta.
Canada Issues Digital Tax Draft After Global Deal Hold-Out
Canada is seeking feedback on a revised version of its digital services tax after declining to sign on to an OECD-penned outcome statement that included an extension of the moratorium on new digital service taxes to the end of 2024.
West African Tax Forum Cautions Members on OECD Global Tax Deal
It’s important to scrutinize the OECD’s two-pillar global tax reform plan and carefully weigh its economic implications before committing to implement it, the West African Tax Administration Forum told its members.
Germany to Raise Modest Tax Revenues Under OECD Global Tax Plan
Germany stands to benefit under both pillars of the OECD’s global tax reform plan, but its tax revenue gains might not be very high, according to research commissioned by the German Ministry of Finance.
Luxembourg Government Approves Global Minimum Tax Bill
Luxembourg’s Council of Government has approved draft legislation to transpose into domestic law the EU’s directive implementing global minimum tax rules under pillar 2 of the OECD’s two-pillar corporate tax reform plan.
Ways and Means GOP Demand 'Robust Consultations' on Pillars
Thirteen House Ways and Means Committee Republicans signed a July 31 letter accusing Treasury of failing to consult with Congress over global tax negotiations that they claim will cost taxpayers at least $56 billion.
Luxembourg Global Minimum Tax Rules Sent for Parliament Approval
Luxembourg approved a legislative proposal to implement the global minimum tax rules. The proposal introduces two new tax rules, a top-up tax and an undertaxed profits rule, to ensure that multinational companies are taxed at a rate of at least 15%.
German Revenue Set for ‘Moderate’ Gains From Global Tax Reform
Germany is expected to see a moderate increase in tax revenue from the OECD-led global tax reform, with additional revenue of between €2.75 billion and €3.9 billion per year between 2024 and 2026. However, the revenue increase could be lower if multinational groups escape the scope of the reform.
GOP, Chamber Ramp Up Pressure on Treasury Over OECD Tax Deal
Republicans and the US Chamber of Commerce are urging the Treasury Department to reexamine its positions on key provisions of the global tax deal, including the global minimum tax. They argue that the deal could harm US businesses and want Treasury to seek more input from Congress.
Chips, China, Taiwan, and Tax Preferences
Mindy Herzfeld examines how recent congressional efforts to bypass traditional tax treaty requirements for encouraging semiconductor chip trade with Taiwan could be models for innovative international tax agreements.
African Cross-Border Trade Growth Demands Tax Transparency
Nana Ama Sarfo reviews the OECD's latest Tax Transparency in Africa report and notes how developments in trade and beneficial ownership transparency could help advance tax transparency on the continent.
The South Centre Warns Against OECD Global Tax Reform Plan
Developing countries should think long and hard before signing on to an OECD-brokered two-pillar global corporate tax reform plan while also considering alternative measures, an intergovernmental policy research organization said.
Developing Countries Cast Doubt on Benefits of Global Tax Treaty
Some developing countries are reluctant to ratify the OECD-led global tax pact until other OECD countries, especially the US, choose to do so. They believe the pact will yield a small amount of revenue and that they risk losing their taxing rights if they ratify it before developed countries do.
Vietnam May Ease Global Minimum Tax Burden for Firms
Vietnam's investment ministry is considering ways to compensate foreign investors who will be affected by the global minimum tax. The measures include providing financial support, training and R&D assistance, and tax breaks.
Ireland Consults Further on Global Minimum Tax Rule Adoption
Ireland’s Department of Finance is asking for more public input on new aspects of its plan to transpose the EU’s pillar 2 directive, incorporating features of the OECD’s second tranche of pillar 2 administrative guidance.
Ireland Seeks More Feedback on Implementing Global Minimum Tax
Ireland is seeking feedback on the six main areas of draft legislation implementing the OECD's 15% global minimum tax. The draft legislation includes safe harbor rules for transitional CbCR and UTPR reporting.
Latam Nations Create Tax Cooperation Forum, in Challenge to OECD
Latin American countries have created a new forum to cooperate on tax issues in response to concerns that the OECD's global tax agreement does not benefit developing countries enough. The forum will be facilitated by the United Nations Economic Commission for Latin America and the Caribbean.
Vietnam Proposes Global Minimum Tax Rules to Apply in 2024
The Vietnamese government will send a draft resolution to the National Assembly proposing the application of global minimum tax rules under pillar 2 of the OECD’s two-pillar global tax reform plan starting January 1, 2024.
Israel Approves New Tax Benefits for Technology Investors
Israel's parliament approved tax breaks for investors in Israeli tech startups to boost investment in the sector. Tax credits are available to private investors in pre-seed and seed rounds, as well as tax relief for companies that acquire tech firms and foreign banks that offer loans to Israeli tech startups.
Semiconductor Industry Presses IRS to Expand Tax Credit Rules
The US semiconductor industry is urging the IRS and Treasury to broaden eligibility for the tax credit for research and manufacturing of semiconductors. The industry wants more of the supply chain to benefit.
GOP Lawmakers Tell Accounting Board to Nix Tax Disclosure Plan
Republican lawmakers want the Financial Accounting Standards Board to withdraw its proposal to force companies to report more details about how much they pay in income taxes and where. The lawmakers said the proposal would expose US multinational companies to enhanced review and tax audits by foreign governments and put them at a competitive disadvantage.
OECD Business Advisory Group Seeks More Minimum Tax Consultations
Businesses want more opportunities to address complexities in the global minimum tax following new guidance from the OECD. They say the guidance is complex and challenging to implement and call for more simplification measures.
Subsidy Wars Heat Up With US Allies Forced to Pay Up or Lose Out
The US is waging a subsidy war with China in an attempt to maintain its technological lead. The European Union is responding with plans to invest billions of euros in clean energy and semiconductor manufacturing.
Nations Could Lose Trillions Without UN Tax System, Group Says
Tax Justice Network says the UN needs to be involved in global tax administration to help stop $4.7 trillion in lost taxes to multinational companies and wealthy individuals over the next decade.
IRS Offers Temporary Relief From Foreign Tax Credit Rules
The IRS is providing temporary relief from expansive foreign tax credit rules, allowing taxpayers to use modified old rules, as the agency reexamines provisions that have swept far more broadly than many practitioners thought necessary.
U.K. Adopts Accounting Standard Changes for Pillar 2 Tax Rules
In response to OECD global minimum tax rules, the U.K. Endorsement Board has accepted amendments to a key international accounting standard that provides temporary relief from deferred tax accounting and targeted disclosure requirements.
Treasury Hits Pause on Imposing New Foreign Tax Credit Rules
The IRS is temporarily allowing taxpayers to follow the old rules on the foreign tax credit while it considers whether to modify its newer, controversial standards for claiming the credit. This is a relief for companies that have complained that the new rules are too strict.
Digital Taxes Won't Go Away Anytime Soon, U.N. Official Says
Despite multilateral attempts to avoid them, digital services taxes will persist, and it would be better for countries to focus on ensuring that those taxes are adopted and interpreted consistently, a U.N. official said.
GOP Seeks to Up Global Tax Deal Oversight With Treasury Official
Republicans are pushing back on the global minimum tax deal, arguing that it would put US companies at a disadvantage. Democrats say that if the US doesn't get on board, it will be left behind.
G-20 Finance Ministers Welcome OECD Tax Reform Plan Progress
The G-20’s top finance officials continue to press ahead with the OECD-brokered two-pillar global tax reform plan, recognizing progress on some of the plan’s key features and calling for countries to settle outstanding issues.
Canada Is Sticking With a Planned Tax on Big Tech the US Opposes
Canada will introduce a digital services tax in 2024 despite US opposition. The Canadian government made a concession by delaying its DST and believes it is necessary to defend the country’s interests.
Taiwan Trade Bill Clears Senate, Heads to Biden’s Desk
The US Senate passed legislation approving a trade deal with Taiwan, which could lead to stronger tax ties between the two countries. The bill also includes transparency and cooperation guidelines for future agreements negotiated under the initiative.
OECD Seeks Simpler Transfer Pricing With Amount B Consultation
The OECD has opened an additional consultation on two amount B alternatives to simplify routine marketing and distribution transactions for transfer pricing. The options could include an examples-based determination of non-baseline distribution activities.
OECD Issues Information Return for Global Minimum Tax Filing
The OECD finalized the information return that multinational companies will use to file their taxes under the new global minimum tax. The return is designed to strike a balance between providing tax administrations with the data they need to ensure compliance while limiting the cost of compliance for companies.
Energy Credits’ Treatment in Global Tax Deal Detailed By OECD
The OECD clarified that the global minimum tax will treat the Inflation Reduction Act’s transferable tax credits as additional income rather than a reduction in tax paid. This means that businesses will not be subject to the undertaxed profits rule if they use the credits to lower their tax expenses.
U.S. Companies Score Partial Reprieve From Global Minimum Tax Deal
Under the updated agreement negotiated by the Treasury Department, U.S.-based companies will have an extra year (until 2026) before foreign countries can start imposing new taxes on any U.S. companies deemed to pay too little tax in the United States. In addition, the clean-energy tax credits at the core of last year’s Inflation Reduction Act will be counted in a more favorable way than some companies had feared, offering certainty as a tax-credit trading market gets under way.
Using Tax Transparency for Latin America's Economic Recovery
Nana Ama Sarfo examines the OECD’s latest report on tax transparency in Latin America and questions whether the organization’s tax transparency standards could be a useful tool in improving the region’s slow economic growth.
Pillar 2 Would Overlook Some Tax-Advantaged IP Transfers
Martin A. Sullivan argues that even if pillar 2 is adopted, multinationals’ income stemming from intellectual property transfers to low-tax jurisdictions is likely to remain as tax advantaged as it is now.