Cross-border Tax Talks

BEPS 2.0 Update: not IF but when

Doug McHoney (PwC's US International Tax Services Co-Leader) is in PwC's brand new studio in Washington, DC with Will Morris (PwC’s Deputy Global Tax Policy Leader). Will also was appointed Chair to the American Chamber of Commerce to the European Union and Chair to the Business Industry Advisory Committee to the OECD. Doug and Will discuss the journey thus far to Pillar One and Pillar Two. They touch on, among other things, the future impacts on US-based multinational companies, what has changed in recent months, digital services taxes & unilateral measures, details of Amount A under Pillar One, possible winners and losers, segmentation, scoping, the potential new instrument needed for implementation, details of GloBE under Pillar Two, including the minimum rate, and of course, the timeline for implementing these changes.

Timestamps:

• 2:30 - Was the Director of the Centre for Tax Policy and Administration at the OECD, Pascal Saint Amans, right earlier this year when he said that “there is not much to do, just a few numbers to firm up” to finalize the OECD Agreement?
• 3:45 - Why should US-based multinationals be paying attention to the OECD and BEPS 2.0 right now?
• 5:25 - What are the highlights and lowlights on what has been decided on Pillar One, particularly since April 2021?
• 12:25 - Thoughts about the companies that might be impacted by Amount A.
• 14:40 - What did we learn about unilateral measures and DSTs and what might we see in the near future?
• 16:50 - What are the highlights on what is left to be decided for Pillar One?
• 20:40 - What is the timeline for these items to be resolved and get implemented?
• 22:30 - Regarding Pillar Two, what has firmed up since July, what have we learned about GLoBe?
• 25:40 - What does Ireland signing on mean? Will have a 15% statutory rate? What does that imply for other countries’ statutory rates?
• 30:43 - What have we learned about the underpayment rule and the subject-to-tax rule?
• 35:41 - Looking ahead, for Pillar two, what is left to be agreed upon after the October Inclusive Framework agreement?
• 40:21 - What would be required (from a procedural standpoint) for the US to adopt Pillar 1 and Pillar 2?

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