The Big Problem With Global Tax Warfare Is Double Taxation

Recent global tax changes show us heading down a path towards “tax warfare”. For the past decade, the Inclusive Framework at the OECD has been attempting to extend the taxing jurisdiction of “market countries” over large multinationals that are able to access consumers in those market countries without triggering taxing jurisdiction under traditional international tax rules. Some market countries have grown impatient and have unilaterally adopted DSTs. Recently, the Trump administration has threatened, imposed, deferred and re-imposed the highest tariffs in a hundred years on goods imported into the US, sometimes justifying these heightened tariffs as “reciprocal” tariffs to fix trade imbalances. In response, other countries are establishing or considering retaliatory tariffs and considering additional DSTs.