Week in Insights: OECD Needs to Find Pillar Two’s Happy Medium

As the OECD continues to promote Pillar Two, balancing the goal of fostering tax fairness with the need to avoid excessive compliance burdens is a challenge.

For many multinational enterprises operating in jurisdictions with tax rates above the Organization for Economic Cooperation and Development’s 15% minimum, the increasing complexity of compliance requirements presents a concern. Enforcing the minimum rate places much administrative overhead on reporting MNEs.

Businesses that already operate in higher-tax jurisdictions—not the targets of Pillar Two—can still face significant costs of demonstrating their tax compliance.

The National Foreign Trade Council has called for the OECD to reduce ...