Weekend Sneak Peek: Global Tax Challenges


For weeks, the tax world has been buzzing about the G-7 Summit and what it could mean for multinational corporations.

G-7 is a shorthand for the Group of Seven Nations, a consortium of wealthy developed countries that have met regularly since the 1970s to discuss global economic concerns and initiatives. Today, the G-7 includes Canada, France, Germany, Italy, Japan, United Kingdom, and United States

British Prime Minister Boris Johnson welcomes leaders from the United States, Japan, Germany, France, Italy and Canada to the G-7 summit.

Photo by Jonny Weeks – WPA Pool via Getty Images.

This month, the leaders of those countries gathered in Cornwall, England for the G-7 summit. Participants included host Boris Johnson (UK), Justin Trudeau (Canada), Emmanuel Macron (France), Angela Merkel (Germany), Mario Draghi (Italy), Yoshihide Suga (Japan) and Joe Biden (US) United). Charles Michel and Ursula von der Leyen were also present representing the European Union; the EU is not a member of the G-7 but usually attends the summit.

During the summit, these leaders attended meetings and issued joint statements on issues affecting global economies and other policies such as climate change. And, unsurprisingly, a global tax deal was center stage with considerable interest focused on multinational corporation taxes, transfer pricing, and digital taxes. You can find out more in What you need to know about the G-7 Tax Agreement.

That’s a lot for tax professionals to do, which is why we’ve got you covered with our Insights Roundup.

Quick numbers quiz

The G-7 has agreed in principle to an overall minimum corporate tax rate of at least 15% on multinational corporations. How many G-7 countries currently have a corporate tax rate above 15%?
(Answer below.)

Our roundup

Keeping track of global tax developments impacting tax planning, compliance and enforcement is essential. From minimum tax rates to transfer prices, here’s what our tax experts are talking about this week.

G-7 finance ministers have announced their support for an overall minimum tax of at least 15% and the reallocation of some profits to large multinationals. In the G-7 finance ministers ‘announcement on Pillars One and Two: Does It Matter ?, Squire Patton Boggs’ Jeff VanderWolk examines the implications.

For more on the G-7 tax deal, check out this week’s episode of Talking Tax, G-7 Tax Agreement Was Big, But Now Comes the Hard Part.

French President Emmanuel Macron (left) shakes hands with President Joe Biden before a bilateral meeting during the G-7 summit in Carbis Bay, Cornwall, UK on June 12, 2021.

Photo by Ludovic Marin / AFP via Getty Images.

This spring, the U.S. government proposed removing the OECD’s requirement that only automated digital services and consumer-facing businesses be included in the first pillar, the OECD’s proposal to tax the economy. digital. In the first part of a two-part article, Taxing The Top 100, Lorraine Eden of Texas A&M University illustrates how the US proposal would create an incentive to regularly restructure multinational companies so that they fall outside the Top 100. In Part 2, Eden shows that the US proposal to use the Top 100 MNEs might be impractical to administer due to the regular membership change.

The rise of tax technology owes much to the development and implementation of AI technology. The digitization of economic transactions on cloud platforms has brought changes to our workplace and our daily lives. The digital economy has also brought an unprecedented amount of information previously inaccessible to everyone. In Technology for Transfer Pricing, Shan Sun of Unilever PLC, examines the challenges and opportunities these changes bring.

Digital assets pose new tax challenges to international tax systems. In Tax challenges of new digital assets and their treatment in Portugal, Rogério M. Fernandes Ferreira of RFF & Associados explains how unique and identifiable digital assets such as non-fungible tokens raise questions and discusses their current treatment in the Portuguese tax framework. .

Closer to home, national businesses are still struggling to recover from the pandemic. The challenges are that relief programs continue to dominate the news.

The pandemic has made remote working necessary for many companies where it may have been only an occasional practice. Many employees decided they liked it. Many businesses have started to consider reducing their office space expenses. In What’s your plan? Avoiding the Tax Traps of a Remote Workforce, Jennifer Weidler Karpchuk and Katherine Noll of Chamberlain Hrdlicka explain tax considerations and how to plan for a larger or more permanent remote workforce.

The Restaurant Revitalization Fund provides relief to restaurants and other eligible businesses whose gross revenues are generated from food and beverage sales. In Key Takeaways of the Restaurant Revitalization Fund, Sofia Cordero de Mazars explains how the program works and the conditions of participation.

IRS issued formal guidelines on employee retention credits (ERC). In IRS Issues Notices With Updated, Formal Guidance on Employee Retention Credits, Isabelle Farrar, Alec Oveis and Joshua Thomas of Ropes & Gray LLP explain how credit works and how businesses can benefit from the two Paycheck Protection Program loans simultaneously. (PPP). and the ERC.

PPP loans have raised many questions for businesses and tax professionals. You can read more about the program’s launch, its future, and efforts to end pandemic fraud in a recent episode of Talking Tax.

Write for us

Bloomberg Tax Insights articles are written by tax professionals providing expert analysis on current issues in tax practice and policy, tax trends and topics, and practice and management. tax and accounting. If you have an interesting and never-published article to publish, we would love to hear about it. You can contact our Insights team by sending an email to TaxInsights@bloombergindustry.com.

Projector

This week, the spotlight is on tax professor Leandra Lederman. Lederman is William W. Oliver Professor of Tax Law and Director of the Tax Program at the Maurer School of Law at Indiana University. As a Professor of Taxation, she leads the Indiana / Leeds Summer Tax Workshop Series with Professor Leopoldo Parada of the University of Leeds. She has also co-authored books on tax controversies and corporate taxation, published over 50 articles, and is one of America’s 10 most frequently cited tax scholars.

Student writing competition

Think you have the writing material for Bloomberg Tax Insights? We’re excited about our first Bloomberg Tax Insights Essay Contest, designed to showcase the best in student writing. Due to a flurry of recent submissions, our deadline has been extended to June 30, 2021.

Run with us

Ready to let off steam after a long (long) tax season? It’s not too late to sign up for our virtual 5k. Run as fast as you want or just take a walk to enjoy the fresh air and earn a cool medal. And since #TaxTwitter loves their waffles, pancakes, and other breakfast foods, we’re paying it forward by donating the profits to World Central Kitchen to help fight hunger. You can register here.

Quick response to numbers

Every seven.

Exclusive content for Bloomberg Tax subscribers

As the digital economy becomes the global economy, historically non-digital businesses are developing innovations and creating new business offerings never seen before. In this special report from Baker McKenzie’s global tax practice, you’ll find an overview of digital technology trends that all non-digital businesses are embracing, which interact with key tax trends that businesses must actively navigate. You will also find case studies focused on healthcare, consumer goods and retail, as well as the broad industry and manufacturing sector, as well as an overview of tax development trends. international and specific digital transfer prices.
* Note: Your Bloomberg Tax ID will be required to read the special report.

More interesting tax content

This is a Bloomberg Tax Insights weekend summary, written by practitioners and featuring expert analysis on current issues in tax practice and policy. For a full article archive, browse by jurisdiction on Daily Tax Report, Daily Tax Report: State, Daily Tax Report: International, Transfer Pricing Report, and Financial Accounting.

You can also follow Bloomberg Tax on Twitter, Facebook and LinkedIn.

What did you think?

We hope you have found Weekend Insights useful. We would love to hear your suggestions to make it more enjoyable. Here is our email: TaxInsights@bloombergindustry.com. Thanks for the reading!



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