Rick Minor Testifies at House Committee on Ways and Means Subcommittee on Tax

L-R: Megan Funkhouser (Information Technology Industry Council), Rick Minor, Gary Sprague (Baker McKenzie), Daniel Bunn (Tax Foundation)

USCIB’s Tax Counsel Rick Minor testified on March 7 at the Hearing before the U.S. House Committee on Ways & Means Subcommittee on Tax, “Ensuring the Biden Administration Puts Americans First.”  It was the first Congressional hearing on the current Pillar One proposals of the OECD Two Pillar solution project.

“The message from the U.S. should be that discrimination against U.S. companies should not be permitted in any case,” emphasized Minor during his oral testimony. “Fiscal measures specifically targeted at U.S. multinationals should never be a legitimate tax policy choice in a stable international tax system.”

Minor also told the Subcommittee Members that a Pillar One solution that does not effectively eliminate double taxation in its application is not sustainable and that U.S. industry is concerned that the current design of Amount B falls short of the stated objectives of the OECD in its original blueprint.

Minor with Mike Kelly

“We can imagine a reality in which these rules can exist in some form, if the final rules stabilize the international tax system,” added Minor.

On behalf of USCIB, Minor encouraged the Biden administration and U.S. Congress to remain engaged in the OECD process.

House Committee on Ways and Means Tax Subcommittee Chairman Mike Kelly (PA-16) led the meeting before the 18 member Subcommittee. Minor’s testimony was one of four from the private sector; other witnesses included Megan Funkhouser, senior director of Policy, Tax and Trade at the Information Technology Industry Council, Gary Sprague, partner at Baker McKenzie and Daniel Bunn, president and CEO of the Tax Foundation.

USCIB in the News: Bloomberg, Tax Notes Quote Rick Minor on New OECD Report on Amount B

SVP Rick Minor was quoted in both Bloomberg and Tax Notes this week following the February 19 release of the OECD’s new report on Amount B, one of the key components of Pillar One of the OECD’s global two pillar solution project.

In Bloomberg Tax, Minor said: “I feel there remains a degree of uncertainty regarding the prospects for broad adaptation of Amount B, directly and indirectly, on which we had placed considerable value from the outset.” Minor expressed concerns “in the context of a mutual agreement procedure, where a treaty partner isn’t obligated to accept the Amount B analysis of another jurisdiction if the first treaty partner doesn’t agree to Amount B.”

To access the full Bloomberg article, please click here to read with a subscription.

The Tax Notes article, titled, OECD Sets Out Amount B Transfer Pricing Simplification Framework, is also available with a subscription and can be found here.

Rick Minor Quoted in Bloomberg Law on OECD Tax Deal, Advocates for Extended Time for Business to Provide Feedback

USCIB Vice President and International Tax Counsel Rick Minor was quoted in a Bloomberg Law article yesterday regarding the Department of Treasury’s handling of a complex Organization for Economic Cooperation and Development (OECD) tax treaty. Treasury is awaiting business input by December 11, with the deadline for the treaty set on December 31. This treaty would reallocate residual profits of big corporations to market jurisdictions under Pillar One of the two-section tax deal.

Minor was quoted as saying, “USCIB views it as essential for Inclusive Framework members, in-scope businesses, and other stakeholders to be given more time beyond the end of this calendar year to complete this important work.” This quote stems from a letter that was sent to Treasury on November 15.

Business has expressed concern that Treasury’s solicitation of feedback from stakeholders may be the administration’s attempt to buy more time for negotiations before any significant decision-making occurs by nations. This move also shifts pressure regarding the treaty’s success or failure away from negotiators and onto business. However, the comment period also sends the message that the U.S. is taking this treaty seriously, as doubts continue to exist about whether the negotiations will be fruitful.

The full article is available with a subscription to Bloomberg Tax and can be accessed here.

Annual OECD-USCIB International Tax Conference Zeroes in on Pillars One and Two

Lily Batchelder (Treasury)

Since 2021 when 140 countries agreed on a global tax deal, international tax policy discussions have concentrated intensely on Pillars One and Two, which focus on the reallocation of residual profits of the largest and most profitable Multinational Enterprises (MNEs) to market jurisdictions and a 15% global minimum tax, respectively.

USCIB’s annual International Tax Conference was no exception. Discussions on Pillars One and Two were the focus of the two-day tax conference, hosted alongside the OECD and Business at OECD (BIAC) on October 30-31 in Washington DC. Hundreds of industry leaders and practitioners including USCIB members, U.S. and foreign government tax officials and press gathered for the much-anticipated event, hosted by USCIB VP and International Tax Counsel Rick Minor.

Lily Batchelder, assistant secretary for tax policy at U.S. Department of Treasury, served as plenary speaker and provided a framework for the two-day conference and touched upon an important element—the multilateral work at the OECD in the tax policy space.

“Today, at the 16th annual Tax Conference of the USCIB, the question is not should the international tax system change,” said Batchelder. “We already know from close to 15 years of experience that the system has changed and returning to old rules is not a real tax solution. Instead, the question is how should the international tax system change in order to encourage global tax certainty and stability? In my view, our multilateral work at the OECD has been, and will continue to be, essential to finding answers to those questions.”

Batchelder’s comments were echoed by Michael Plowgian, deputy assistant secretary for international tax affairs at the U.S. Treasury Department, who spoke on the first panel, The International Tax Agenda. “The administration remains committed to implementing Pillars One and Two,” said Plowgian. “We believe it’s the best way to address the instability that we see in the international tax system.”

Rick Minor (USCIB)

The second day kicked off with panels on Pillar Two, discussing the implementation of the global minimum tax and improving global tax coordination, particularly relating to rule co-ordination and dispute prevention and resolution.

Beyond Pillars One and Two, experts also discussed other pressing issues such as addressing increased global mobility of workers, carbon mitigation approaches, tax certainty beyond the Pillars and the rationalization of other base erosion and profit shifting (BEPS) measures.

The conference was sponsored by USCIB. Corporate sponsors included EY, PwC, Amazon, Caplin & Drysdale, General Mills, KPMG, Baker McKenzie and ExxonMobil.

Other featured speakers included:

  • Alan McLean, Chair, BIAC Tax Committee and former Executive Vice President, Taxation and Controller, Shell International Limited, UK (retired)
  • Achim Pross, Deputy Director, OECD CTPA
  • Barbara Angus, Global Tax Policy Leader, Ernst & Young (EY)
  • Bob Hamilton, Commissioner of the Canada Revenue Agency; Chair of the FTA
  • Bob Stack, Managing Director, Washington National Tax, Deloitte Tax LLP
  • Brett Weaver, Partner, KPMG
  • Carolina Perez-Lopez, Vice President, Global Tax Planning and Tax Counsel, Johnson & Johnson
  • Carlos Eduardo Protto, Director of International Tax Relations, Ministry of Treasury, Argentina
  • Dani Rolfes, Partner in Charge, Washington National Tax, KPMG
  • Daniel Smith, Director, International Tax Planning & Policy, Alphabet
  • Hannah Hawkins, Principal, Washington National Tax, KPMG
  • Isaac Wood, Attorney-Advisor, Office of Tax Policy, U.S. Treasury
  • Jason Weinstein, Vice President, Tax, North America, Amazon
  • John Peterson, Acting Head of Division ICA, OECD CTPA
  • John Stowell, USCIB Tax Committee Chair, Head of Global Tax and International Financial Reporting, The Walt Disney Company
  • Josh Ruland, Principal, EY
  • Kevin Nichols, Head of Tax ESG, Tax Communications, and Tax Policy, Uber
  • Kyle Meng, Senior Economist, White House Council of Economic Advisers
  • Liz Stevens, Member, Caplin & Drysdale
  • Manal Corwin, Director, OECD CTPA
  • María José Garde, Director General of Taxation, Ministry of Finance, Spain
  • Mark Harris, Vice President and General Tax Counsel, The Coca-Cola Company
  • Mark Martin, Principal, Washington National Tax, KPMG
  • Marlene Nembhard-Parker, Co-Chair of the Inclusive Framework; Deputy Commissioner General, Legal Support Services – Tax Administration Jamaica
  • Marco Iuvinale, Director of European and International Tax Affairs, Italian Ministry of Economy and Finance
  • Mary Jones, Director, Benefits Taxation, Microsoft
  • Mike Williams, Director of Corporate Tax, HM Treasury
  • Nate Carden, Partner, Skadden
  • Nick Schulz, Director of Stakeholder Engagement and Senior Policy Advisor, ExxonMobil
  • Nicole Welch, Director, Treaty and Transfer Pricing Operations, LB&I, IRS
  • Pat Brown, Principal, Washington National Tax, PwC
  • Peter Blessing, Associate Chief Counsel (International) at the Internal Revenue Service
  • Rafic Barrage, Partner, Baker & McKenzie
  • Rick Minor, VP & International Tax Counsel, USCIB
  • Robert Cusmano, Senior Director, Global Tax Policy, Procter & Gamble
  • Silke Bruns, Director for International Taxes, Federal Ministry of Finance, Germany
  • Thomas Bettge, Senior Manager, Washington National Tax, KPMG
  • Tobias Appl, Partner, EY
  • Tom Roesser, Tax Policy Counsel, Microsoft
  • Tracee Fultz, Global Transfer Pricing Leader, EY
  • Whitney Baird, President & CEO, USCIB
  • Will Morris, Global Tax Policy Leader, PwC
  • Yah Fang Chiam, Deputy Commissioner, Business Group, Inland Revenue Authority of Singapore

The 17th annual OECD USCIB International Tax Conference will be held on June 24-25, 2024 in Washington DC.

USCIB Member Spotlight: EY on Multinationals Face Complex Data Challenges from Global Tax Deal

USCIB member EY America’s Kevin Flynn discusses how businesses can position themselves to comply with the BEPS 2.0 project. The full article can be viewed via a paid subscription to Bloomberg Tax.

EY was a sponsor at this week’s USCIB-OECD International Tax Conference

“Multinational enterprises are facing new and complex tax rules stemming from the OECD and G-20 countries’ BEPS 2.0 project—particularly the project’s Pillar Two 15% global minimum tax, which is set to apply to multinational groups with global revenue of more than €750 million ($829 million).

Enforcing these rules will require unprecedented global cooperation between tax authorities, and implementation approaches likely will vary among jurisdictions adopting the rules, making compliance a challenge and creating the risk of controversy. Multinationals also will need to manage a substantial increase in data collection and tracking required to comply with these rules.

Given the rules’ scope and complexity—and implementation as early as 2024 in many jurisdictions—multinationals need to evaluate and update their existing data strategies now.”

Read the rest of the post here.

USCIB Member Spotlight: EY’s Marna Ricker Writes About Implementing Pillar Two

USCIB member EY’s Marna Ricker authored a post on “Implementing Pillar Two Requires Resources, Flexibility,” in which she discusses the critical phase of the global minimum tax project.

She writes: “Like businesses, governments should be focusing on the practical aspects of applying and administering the new rules.

“The G20-led project on addressing the tax challenges of the digitalisation of the economy is entering a critical phase as jurisdictions work to enact Pillar Two global minimum taxes even while technical and administrative aspects of the new system are still being hammered out in the Inclusive Framework. There is much businesses need to do to be ready to comply with widespread implementation, and much preparation ahead for tax administrations as well. 

“Smooth implementation of Pillar Two is in the interest of both businesses and governments and is an urgent matter given that many countries are working to have global minimum tax rules in place by the end of the year. Businesses are trying to understand the new compliance obligations following the rules and working through the complex computations to determine where they may have top-up taxes due beginning in 2024. In addition, businesses are monitoring how the introduction of minimum tax rules may be accompanied by other changes in the design of corporate income taxes in the countries where they operate.”

To read the full post, please click here.

About the author: Marna Ricker, EY Global Vice Chair – Tax, is an EY veteran of more than 28 years and oversees all aspects of the EY Tax strategy, its offerings and client services for the EY Global Tax service line, which comprises more than 76,000 EY Tax, People Advisory Services (PAS) and Law professionals worldwide.

Treasury’s Michael Plowgian Headlines Tax Webinar on OECD Multilateral Convention

Deputy Assistant Secretary of Treasury Michael Plowgian led a team of his Treasury Department colleagues, Elizabeth Bell, Chris Bello, and Huzefa Mun in an exclusive USCIB member tax webinar on October 20 on the draft text of the Multilateral Convention to Implement Amount A of Pillar One (MLC).

The draft text was released just on October 11 and followed the same day with the U.S. Treasury Department consultation request regarding the same.

The Treasury team was joined on the webinar panel by USCIB International Tax Counsel Rick Minor and USCIB Tax Committee Chair John Stowell, head of tax at The Walt Disney Company. Topics discussed were the mechanics of certain U.S.-driven provisions in the MLC, the progress of Amount B deliberations and the latest on the once and potentially future DST moratorium linked to the MLC.

“The webinar discussion was a good warmup to the OECD-USCIB Tax Conference on October 30-31,” said Minor.

Rick Minor Quoted in Bloomberg Tax on Yellen, Advocates for One-Year Extension of DST Moratorium   

USCIB VP and International Tax Counsel Rick Minor was quoted in a Bloomberg Tax article yesterday regarding Treasury Secretary Janet Yellen’s statement regarding the Pillar One Multilateral Convention deliberations timeline being extended into 2024. Yellen was silent on the moratorium on digital services taxes (DSTs) that is set to expire at the end of this year.

In the article, Minor was quoted as saying, “Yellen’s statement clarifies the timeline, and pushing the process into 2024 makes sense, to give Treasury a realistic chance to digest and react to business feedback to the draft treaty.”

Minor was also quoted as saying he “hoped an announcement will be made soon about extending the DST moratorium. Such a move would be ‘natural.’”

But what Minor actually stated to Bloomberg was “it would now be natural to extend the DST moratorium for another year if the multilateral convention (MLC) signing timeline for 2024 cannot yet be defined and we hope that such an announcement can be made soon from the OECD.”

This will surely be a topic during the upcoming OECD-USCIB International Tax Conference at the Four Seasons in Washington, DC October 30-31.

The full article is available with a subscription to Bloomberg Tax and can be accessed here.

 

Minor is Guest Speaker at Keidanren Quarterly Tax Committee Meeting  

Rick Minor, USCIB VP and international tax counsel, was the featured speaker at the Japanese Keidanren third quarter tax committee meeting on October 12.

Keidanren is the largest industry association in Japan and is roughly equivalent to a national Chamber of Commerce.

Minor was asked to present to the committee on the U.S. views of the Two-Pillar Solution and the significance of this week’s Pillar One Multilateral Convention release and the related U.S. consultation request. Over 60 members of the Keidanren tax committee attended the virtual meeting.

Swiss Government Names USCIB’s Rick Minor to DC Study Group

L-R: Rick Minor (USCIB) and Jacques Pitteloud (Swiss Ambassador)

The Swiss government has named USCIB VP of Tax Rick Minor to its 3rd Study Tour to Switzerland from September 26 to 29.

Minor will join 10 other Washington DC-based association and think tank leaders for a full program of high level meetings with Swiss business leaders, politicians and international organizations such as the World Trade Organization (WTO) and World Economic Forum in an itinerary that includes Zurich, Berne, Geneva and Lausanne.

“This year’s trip will explore the theme of innovation in Switzerland, focusing on topics in the areas of finance and the green economy,” according to the invitation from Ambassador Jacques Pitteloud.