By measuring base erosion only through certain related party outbound payments, the Tax Cuts and Jobs Act misses much of the profit shifting that has created the more than $2.6 trillion of overseas untaxed profits. This article shows how the base erosion provisions in the legislation could be...

A recent KPMG transfer pricing study posits fixed percentages for returns to marketing and distribution activities, a.k.a. Amounts B and C in OECD parlance. The study casts some light on the OECD's design for a new global tax allocation respecting the profits of certain digital economy firms. By...

The OECD is holding public consultations on 13 and 14 March 2019 on the challenges facing countries' corporate tax systems as a result of the ever-increasing digitalisation of the economy. As part of these consultations, a document listing the problems at stake and suggestions for possible...

In 2018, the European Council and the UK and Spanish governments each proposed to introduce a Digital Services Tax (DST), to be levied on the revenue of large digital platform companies earned from advertising, online intermediation, and/or the transmission of data. We offer a rationalization of...

In regard to "Options to address the broader direct tax policy challenges", I suggest that the Task Force consider several matters:- Practical "best practice" approaches for determining some minimal level of digital presence that would be treated as a PE. The Task Force should recommend language...

Since 2018, the UK government, the European Commission, and several European national governments have advanced bold proposals for a new “digital services tax” (DST), with the aim of capturing profits earned by multinationals that reflect value contributed by users of digital platforms. I...

In 2018, the European Council and the UK and Spanish governments each proposed to introduce a Digital Services Tax (DST), to be levied on the revenue of large digital platforms from advertising, online intermediation, and/or the transmission of data. We offer a rationalization of the DST as a...

The Unified Approach issued by the OECD Secretariat on Oct 9, 2019, is the OECD's most recent attempt to find international consensus on BEPS Action Item 1, “Taxing the Digital Economy.” Our assessment is that the Pillar One proposals in the Unified Approach suffer from several defects, the...