Doug McHoney (PwC’s International Tax Services Global Leader) is at PwC’s Global Transfer Pricing Conference where he’s joined by Giorgia Maffini. Giorgia is part of PwC’s Global Transfer Pricing team in London and was previously the Deputy Head of the Tax Policy and Statistics Division at the OECD. Doug and Giorgia discuss why taxpayers should care about Pillar One, starting with the basics what is Pillar One and how does it work with Pillar Two? They discuss the complexities, scope and impacts of both Amount A and Amount B. Also the timing, economic impact, and what’s next. Finally, they address what might happen with digital services taxes and what companies should do next.

Timestamps:

1:17 Giorgia share’s the visitor’s bureau pitch for her hometown in Northern Italy.
2:30 Why should taxpayers care about Pillar One?
4:35 How does Pillar One fit into Pillar Two?
7:14 What is Amount A, and why don’t we have a better acronym?
10:11 What makes Amount A complex, as far as how that profit is allocated?
13:00 What is Giorgia’s reaction to the OECD’s comments?
16:15 What about safe harbours? Are there any industry exceptions?
18:48 How do jurisdictions go about legally implementing these?
19:53 What is the official timing of Pillar One?
21:00 What is Amount B?
22:43 What about the pricing methodologies?
24:42 Does this mean new documentation? Additional documentation? Will it really simplify jurisdiction’s transfer pricing documentation requirements?
26:18 How would Amount B be implemented?
28:30 What is the economic impact of Pillar One? The winners? The losers?
30:09 Is Pillar One really a tax on largeUS tech companies?
32:00 At least 30 countries will need to sign this multilateral convention for it to come into force. Where do we stand?
32:30 United States
33:36 Europe
34:14 Asia
36:07 One of the points and commitments is that Amount A would eliminate Digital Services Taxes. What is the status of DSTs?
38:14 What should companies do now to address Pillar One?