Cross-border Tax Talks

May 06, 2025

Itai Grinberg: The Pillar Two origin story (part 2) 

Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Professor Itai Grinberg, a faculty member at Georgetown University Law Center and a former Deputy Assistant Secretary at the US Treasury Department during the Biden administration. In that role, Itai served as the United States' lead negotiator for the global corporate minimum tax initiative. Doug and Itai discuss the behind-the-scenes history of Pillar Two from the US perspective, exploring its policy rationale, global negotiations, and shifting political dynamics. The conversation begins with how Itai’s got his role at Treasury and builds a detailed timeline tracing the Biden administration’s early support for global minimum tax rules through the 2021 G7 agreement and the development of the Under-Taxed Profits Rule (UTPR). They also delve into the impact of the Build Back Better legislation which was not enacted, the rationale behind the US safe harbor under UTPR, international political tensions including Brexit and US-China relations, and the implications of the April 2025 Trump executive order. The episode closes with reflections on the OECD Inclusive Framework’s future and whether multinational enterprises can expect a workable consensus moving forward. 

  •  00:00 - Introduction, Itai’s background  
  •  02:20 - What does Itai tell his students about pursuing international tax? 
  •  03:40 - Timeline: The BEPS project in 2013 and origins of Pillar Two 
  •  04:40 - How did Itai get a job in the Biden administration? 
  •  07:15 - Itai’s role in the Biden Administration and his focus on Pillar Two as part of economic and diplomatic strategy 
  •  12:05 - Pillar Two impacted broader policy and foreign affairs – how Pillar Two became an imperative beyond the Treasury Department 
  •  13:40 - Itia’s first trip abroad with Secretary Yellen: The G7 sprint and securing international buy-in 
  •  16:10 - Talk of a minimum rate and UK’s post-Brexit political headwinds on Pillar Two 
  •  19:05 - Politics are complicated - Messaging, realism, and political gamesmanship 
  •  20:00 - We have a deal: The G7 agreement on Pillar Two 
  •  22:30 – Undertaxed Payments Rule vs. Undertaxed Profits Rule: Why the rules changed  
  •  26:00 - Private sector concerns: Could China escape Pillar Two? 
  •  29:00 - A White House meeting: Estimates and addressing China 
  •  30:30 - More Interesting points on UTPR and treaty overrides 
  •  33:20 - Build Back Better collapse and legislative uncertainty 
  •  35:40 - Creating the US safe harbor and OECD compromise 
  •  39:10 - Itai’s crystal ball: Reflections on the inclusive framework process and the OECD’s future 
  •  43:30 - Trump’s executive order and escalating trade tensions 
  •  44:52 - Alternative worlds: Could GILTI still qualify? Prospects for a US exemption; impact of proposed Section 899 
  •  48:40 - Closing thoughts: Would Itai do anything differently based on his experience? 

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Speakers

Doug McHoney

International Tax Services Global Leader, PwC US

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