Cross-border Tax Talks

Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Nils Cousin, an international tax partner in PwC’s Washington National Tax Services Practice, for his fourth appearance on the show. Doug and Nils discuss Nils’s April 2024 Jeopardy experience before pivoting to the 1916-era Section 892 exemption: how foreign governments, sovereign wealth funds, and public pension funds use it, and how ‘commercial activity’ and ‘controlled commercial entity’ rules can taint the benefit. They unpack the December 2025 regulation package, highlighting what was finalized (including an inadvertent-activity cure period, the qualified partnership exception, and FIRPTA taint relief) and what remains proposed, especially a framework that presumptively treats many debt acquisitions and workouts as commercial activity. The episode closes with the regulation process, effective-date mechanics, and a January 18 Treasury Secretary tweet, leaving us wondering whether market feedback might drive revisions. 

Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Craig Stronberg, Senior Director on PwC’s Intelligence Team. Craig leads analysts focused on macroeconomic and geopolitical intelligence; he previously served in the Office of the Director of National Intelligence. Doug and Craig discuss why business and tax leaders should focus on the geopolitical landscape to understand its impact on cross-border business, including tax. Stability is the new bar for many businesses in 2026, requiring greater agility to deal with change. Craig discusses how many businesses are in a 'wait‑and‑see' mode versus decisive movers across industries. He also describes areas of focus, such as the US policy stance for the Americas, Greenland, and tariffs; the Global South’s rising coordination; and governance strains across the G20. While AI data falsification is a significant concern, Craig suggests practical actions for boards such as enabling direct access to the business’ risk team.

Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Pat Brown, an International Tax Partner in PwC’s Washington National Tax Services practice and Co-leader of the National Tax Office. Pat previously served as GE’s VP of Tax and Director of Tax Policy. Doug and Pat discuss highlights from 2025: the US day-one Pillar Two executive order and the OECD’s late-year side-by-side package; Section 899; the shifting of DSTs into the trade lane; and the expanding role of the UN for global tax policy. On US policy, they also unpack how OBBBA yielded greater stability; CAMT corrections; stock buyback excise tax guidance; and long-awaited Section 987 rules. Looking ahead to 2026, they assess the potential for additional US tax legislation under reconciliation, as well as the future of Pillar Two, its complexity, and how QDMTTs are now the backbone of Pillar Two. 

Beth Bell, a Principal at PwC's Washington National Tax Services, lends her extensive experience in tax policy to discuss the OECD’s January 2026 side-by-side package. She highlights how political dialogue resolved initial objections from countries like China and Estonia. The conversation dives into the implications of new qualified tax incentives and the functioning of the simplified ETR safe harbor. They explore congressional responses and emphasize the importance of QDMTTs for public companies, while advising taxpayers on compliance essentials for the upcoming changes.

Hanan Abboud, a Dubai-based tax expert leading PwC's Pillar Two initiatives in the Middle East, shares insights on the intricate corporate tax landscape across the GCC. She discusses the unique aspects of Zakat in Saudi Arabia and Kuwait, along with the prevalence of withholding taxes and treaty networks. Hanan explains the intricacies of Bahrain's upcoming QDMTT and contrasts it with Oman and Qatar's approaches. She emphasizes the compliance challenges posed by data collection and urges Middle Eastern firms to start addressing Pillar Two requirements promptly.

Doug McHoney (PwC’s International Tax Services Global Leader) is joined by Beth Bell, a principal in PwC’s Washington National Tax Services Policy group. Beth previously served as a senior advisor at the U.S. Treasury Department, tax counsel for the House Ways and Means Committee, and policy director and tax counsel in the U.S. Senate. Doug and Beth discuss contrasts between Senate personal offices and House committee roles; Ways and Means’ tax jurisdiction; and Beth’s experience moving from Congress to Treasury. Next, they jump into how DST disputes led to Pillar One and ultimately the emergence of Pillar Two; Build Back Better legislation; the Pillar Two model rules; U.S. credit design under Pillar Two; and the new administration’s response to Pillar Two. 

Tad Fowler, Senior Vice President, Treasurer, and Global Taxes at Procter & Gamble, shares insights on U.S. tax reform and its implications for multinational companies. He highlights the need for ongoing policymaker education to ensure tax certainty. The discussion delves into P&G’s unique after-tax performance metrics and the complexities of Pillar Two compliance. Moreover, Tad emphasizes the role of AI in augmenting decision-making and outlines P&G's tax priorities focusing on partnership, efficiency, and transparency.

In this insightful discussion, Matt Ryan, PwC UK’s International Tax and Treasury Network Leader, shares his expertise on the complexities of Pillar Two and UK tax policy. He discusses the evolving acceptance of net CFC tested income's coexistence with Pillar Two rules and outlines the timeline for UK legislative changes, potentially effective by 2026. Matt also highlights challenges like M&A data gaps and the lack of a global dispute mechanism. The conversation wraps up with updates on the UK corporate rate and the digital services tax.

Wade Sutton (PwC’s WNTS International Tax Services Leader) guest hosts the podcast and is joined by Rob Ozmun, a State and Local Tax Partner, and Monic Kechik, PwC’s WNTS Federal Tax Services Leader. Together they discuss the OB3 ‘curveballs’ to the federal changes: Section 163(j) - ATI addbacks of depreciation and amortization; Section 174A - domestic expensing; Section 168(k) - the return to 100% bonus depreciation; and Section 168(n) - qualified production property (QPP). They explore how accelerated deductions can trigger BEAT and CAMT via ordering‑rule dynamics and book‑tax timing, creating cash‑vs‑ETR trade‑offs that can be addressed with capitalization provisions. They also examine state conformity models, rapid decoupling (e.g., D.C.), and wrinkles such as California’s departures and R&D credits.

Will Morris, PwC's Global Tax Policy Leader, dives into the complexities of international tax policy with insights on Pillar Two. He discusses how trade policy influences tax outcomes and the challenges geopolitics poses for multilateral agreements. The conversation covers the EU's ambitious simplification agenda amidst resistance, the current landscape of Digital Services Taxes, and the emerging role of the UN in tax policy. Morris also highlights the limitations of AI in tax data management and predicts a future of competing tax blocs.