David Rosenbloom and Peter Barnes Talk to Law360 on OECD Pillar One and Pillar Two

Law360 Tax Authority

Despite years of fine-tuning, the Organization for Economic Cooperation and Development's proposals to overhaul the global tax system still raise serious concerns about administrability, panelists said Friday at a virtual conference.

. . .

"I don't have any particular objection to it; I just don't think it's practical," said David Rosenbloom, a Member of Caplin & Drysdale and former international tax counsel at the U.S. Treasury Department. "I think the underlying thinking in both Pillar One and Pillar Two is highly unadministrable. I think we're going to be discussing this forever."

Rosenbloom spoke during a panel at the American Bar Association tax section's virtual May meeting.

. . .

Peter Barnes, (Of Counsel at Caplin & Drysdale) a professor of tax law at Duke, and a former senior tax counsel at General Electric Co., said enforcement of Pillar Two would be a challenge.

"It seems to me that we've set ourselves up for failure by setting our sights on a global minimum tax that everybody buys into," he said. "I'm just bewildered by the idea of enforcement of Pillar Two, of how if one country doesn't tax it enough, some other country steps in and does tax it."

Rosenbloom said tracking how countries are carrying out the measure could also create headaches.

"It depends on knowing an awful lot about what's going on in other countries," he said. "My experience tells me that it's not as transparent a world as either of these proposals suggest."

Representatives of the OECD did not immediately respond to a request for comment.

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