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ARTICLE · 06 MARCH 2025

US Withdraws Support For Pillar II: Protective Measures Expected

De Brauw Blackstone Westbroek
De Brauw Blackstone Westbroek
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De Brauw Blackstone Westbroek

De Brauw Blackstone Westbroek

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On 20 January 2025, the Trump administration issued an executive order relating to Pillar II.

NetherlandsTax
Wiebe Dijkstra
Wiebe Dijkstra
Peter Spijker
Peter Spijker
Henk Van Ravenhorst
Henk Van Ravenhorst
Mees Vergouwen
Mees Vergouwen
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On 20 January 2025, the Trump administration issued an executive order relating to Pillar II. It comes as no surprise that the new administration, as part of its broader trade policy, is withdrawing US support for the Global Tax Deal's Pillar II. More interestingly, the Secretary of Treasury has been tasked with proposing protective measures against countries that do not comply with US tax treaties or that have, or are likely to have, perceived extraterritorial taxes that affect US companies. These seem to include countries that would apply the UTPR (Undertaxed Profits Rule) to profits of US group companies. While the way the new administration announced the order and measures seems to be highly political, the compatibility of the (extraterritorial) UTPR with tax treaties has been questioned before.

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