Cross-border Tax Talks

Doug McHoney (PwC's US International Tax Services (ITS) Leader) is live at the Westminster Studios with Tom Patten (ITS Partner based in London) to discuss current and future tax considerations for US inbound companies. Doug and Tom chew on toasted ravioli and sandwich structures and then cover, among other topics: the impact of a Pillar 2 regime on US inbound companies; the potential for replacing the base erosion anti-abuse tax (BEAT) with the Stopping Harmful Inversions and Ending Low-tax Developments (SHIELD) provision, impending changes and proposals to interest expense, further limiting the ability of domestic corporations to expatriate; the effects of Brexit on US inbounds; and the potential for Pillar 1 to spurn treaty negotiation and ratification.

Doug McHoney (PwC's US International Tax Services Leader) is live at the Westminster Studios with Calum Dewar (Integrated Global Structuring Leader) to discuss the OECD’s Two Pillar solution to address the taxation of the digitalization of the economy. Doug and Calum cover, among other topics: Pillar 1 -  the reallocation of profits of large multinational companies; Pillar 2 - a global minimum tax rate of at least 15%; the momentum to find a consensus agreement; the design challenges the OECD still faces; how PIllar 2 proposals compare to the US GILTI regime; the potential for carve outs and segmentation; the implementation obstacles in the United States; and the importance of US multinationals to engage with policy makers.

Doug McHoney (PwC's US International Tax Services Leader) is live at the Westminster Studios with John McDonald (Quantitative Solutions & Technologies Managing Director) to discuss the role of technology in tax. Doug and John cover, among other topics: the cross section of computer science and tax; the economics of the professional services industry; how TCJA has made taxation much more complex;  the digital evolution of tax research; the power of definitions and testing to retain information; the usefulness of a graph data structure in tax; how centralized rules engines are superior to spreadsheets; the power of visualizations; the future of probability analysis in taxation, and the need for change management.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) holds another post-vaccine session live at the Westminster Studios with Maarten Maaskant (PwC’s Foreign Tax Desk Leader) to discuss the latest happenings in the European Union (EU) from a legislative, administrative, and judicial perspective. Doug and Maarten cover, among other topics: both the Amazon and Engie state aid decisions in the EU General Court and their future implications; public country-by-country reporting; the European Commission (EC) proposal for a new instrument to address potential distortive effects of foreign subsidies; and the EC communication on business taxation for the 21st century.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) sits down virtually with Dr. Alexis Crow (PwC's Global Leader of Geopolitical Investing Practice) to discuss the state of globalization, and more specifically, whether we have seen the end of globalization. Doug and Alexis cover how the landscape has shifted, and how we got to the current state; tensions within the technology sector, including a 'cold war' from a technology perspective; the globalization of the financial services sector; possible solutions for global cohesion; trends in tax and business from digital and environmental perspectives, and the increasing significance of Asia's role; climate policies and the 'greening' of financial flows; and the future of globalization, including what business leaders and investors should expect in a covid-recovering global economy.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) holds the second post-vaccine session live at the Westminster Studios with Pat Brown (PwC WNTS Policy Co-leader) to discuss President Biden’s FY 22 Budget and the much anticipated and related explanations of such proposals, also known as the Treasury Green Book. Doug and Pat cover, among other proposals: increasing the US corporate income tax rate from 21% to 28%; increasing the global intangible low-taxed income (GILTI) tax rate to 21%; removing the qualified business asset investment (QBAI) provision; repealing the deduction for foreign derived intangible income (FDII); replacing the Base Erosion and Anti-Abuse Tax (BEAT) with a Stopping Harmful Inversions and Ending Low-tax Developments (SHIELD) provision; restricting deductions of excessive interest for disproportionate borrowing in the US; the status and likelihood of the OECD’s Pillars One and Two; and what companies should consider as potential tax legislation becomes more likely.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) is joined in person at the Westminster Studios by David Parrish (PwC's ESG Tax Leader) to discuss the umbrella term environmental, social, & governance. Doug and David cover: the definition of ESG; its effects on a company's business and footprint; the driving forces of NGOs, investors, consumers, and governments;  the impacts it has on deals, capital investment, & tax; the alignment of ESG corporate strategies and goals; and the path forward from sustainability, transparency, and value chain perspectives.

Doug McHoney (PwC's US International Tax Services Leader) and David Cueller (PwC Mexico’s Tax and Legal Services Leader) discuss Mexican developments, including outsourcing reform and Mexico's current position in the OECD BEPS Project. Doug and David cover: the history of Mexico's outsourcing regime; recent disruptive changes made to various laws, including the Income Tax Law, VAT Law, and Labor Law; the specialized services exception; companies impacted by the recent law changes; the potential for penalties and tax fraud; relevant compliance concerns; and US tax considerations. They also discuss Mexico's BEPS-aligned legislation and the non-deductibility of payments to certain foreign entities.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) and Chip Harter (Senior Policy Advisor in PwC's Washington National Tax Services Practice and former Deputy Assistant Secretary for International Tax Affairs in the Office of Tax Policy at the US Department of the Treasury) discuss Chip's experiences at Treasury and the latest outlook for tax policy.  Doug and Chip cover: Chip's involvement in the review and publication of IRS regulations and the role of Treasury officials in the regulations' process; Chip's involvement in the Tax Cuts and Jobs Act (TCJA); Chip's thoughts on the global intangible low-taxed income (GILTI) regime and his reaction to the interplay of the foreign tax credit regime and GILTI; the history and recent updates to the GILTI high-tax exception; and the prospects for a 'true' global minimum tax and the outlook for agreement on the OECD's base erosion and profit shifting (BEPS) project.

Doug McHoney (PwC's US International Tax Services (ITS) Leader) and Thomas Groenen (PwC's US ITS-Financial Services Leader) discuss the renewed interest in special purpose acquisition companies (SPACs). Doug and Thomas cover: how Thomas made his way from the UK to the US; Thomas's advice for individuals interested in moving to the United States to become tax professionals; what a SPAC is and how it generally functions; the history of SPACs—dating back to the British 'South Sea bubble' in the early 18th century; how SPACs compare to and interrelate with IPOs; how and why individuals and entities invest in SPACs; the tax implications for SPAC investors; considerations regarding the SPAC's jurisdiction; the SPAC lifecycle, from founding to de-SPACing; the importance of choosing the correct investment vehicle (both corporate v. pass-through and domestic v. foreign); how the passive foreign investment company (PFIC) regime interplays with foreign SPACs; and the possible future of SPACs.­