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There have been significant shifts in the global tax landscape over the last 12-18 months, with much of the discussion and activity in this area focused on implementation rather than reform. Businesses have been required to navigate an increasingly complex mix of the Organisation for Economic Co-operation and Development’s Pillar Two rules, domestic minimum taxes and evolving national regimes.

UNITED STATES

Caplin & Drysdale

“Key developments in US international taxation include changes to the Global Intangible Low-Taxed Income (GILTI), now Net CFC Tested Income (NCTI) and the foreign-derived intangible income, now Foreign-Derived Deduction Eligible Income (FDDEI) regimes, effective 1 January 2026. The NCTI taxes US multinational enterprises (MNEs) on income of controlled foreign corporations. The FDDEI regime allows a reduced tax rate on income earned on non-US sales that result from US activities. The regimes are intended to tax income on non-US sales similarly, whether the activity takes place within or without the US.”

CANADA

Doane Grant Thornton LLP

“For multinational enterprises (MNEs), the two biggest changes have centred on the introduction of Pillar Two and the Canadian expansion of the hybrid entity provisions. Canada adopted Pillar Two reporting for global minimum tax effective for taxation years that begin on or after 31 December 2023, with the first returns due 30 June 2026 for 2024 calendar year reporters. While Canadian outbound reporting entities are easier to identify, of particular concern has been inbound subsidiaries of foreign MNEs which may have a reporting obligation by virtue of the revenue test but are not otherwise obligated to report anywhere else globally.”

REPUBLIC OF IRELAND

Grant Thornton

“The most significant development in Ireland in recent months has been preparation for the first Pillar Two global minimum tax returns and payments, with the first receipts hitting the Exchequer of Ireland on 30 June 2026. Given the complexity of the new tax, significant guidance was issued in advance to assist taxpayers and advisers, by both Irish Revenue and the Organisation for Economic Co-operation and Development (OECD). While the guidance was welcome, it is practically impossible to cover all scenarios, and there were instances where legislation or guidance needed to be interpreted and a position taken.”

LUXEMBOURG

ATOZ Tax Advisers

“Luxembourg has introduced several tax measures aimed at enhancing its attractiveness as a hub for asset management and innovation, and at improving Luxembourg’s ability to attract and retain highly skilled talent. A key development is the reform of the carried interest regime, which modernises and clarifies the existing framework, broadens the scope of eligible beneficiaries and offers highly competitive tax treatment. Depending on the structure, carried interest may be taxed at only one quarter of the taxpayer’s marginal income tax rate or even benefit from a full exemption where certain conditions are met.”

SWITZERLAND

Riedweg & Partner AG

“Switzerland’s tax landscape has undergone significant changes in the recent past. There have been several key domestic developments, besides global minimum tax, that provide interesting tax structuring opportunities. For businesses, a key development is the extension of the tax loss carry forward period from seven to 10 years. Under the new legislation, expected to apply from the 2028 tax year, legal entities and self-employed individuals can offset tax losses incurred from the 2020 tax period onward against taxable income for up to 10 subsequent tax periods.”

ITALY

Studio Tributario e Societario – Deloitte

“Over the last 12-18 months, Italy has enacted several notable tax developments. Pillar Two has been fully implemented, introducing a 15 percent global minimum tax for large domestic and multinational groups and requiring significant system and data upgrades. Rules on the carry forward of tax losses in corporate reorganisations have also been refined, with stricter anti‑avoidance conditions on changes of control and business purpose, while preserving neutrality for qualifying intragroup transactions.”

GREECE

Potamitis Vekris

“The last seven years has seen Greece undertake its most ambitious tax transformation in decades, as it aims to become an investment-friendly country with low levels of tax evasion. The shift is happening on three fronts simultaneously. On the international side, Greece has joined the global minimum tax framework, raising the stakes for multinationals operating here. But the developments generating the most excitement concern corporate restructuring and private wealth planning. A 2024 unified law has removed decades of friction from mergers, spin-offs and reorganisations, making Greece a far more attractive place to consolidate or grow.”

MALTA

Deloitte Malta

“There have not been any major structural reforms to the tax system, with the government prioritising continuity over disruptions. Nevertheless, there have been some noteworthy developments on a smaller scale. Perhaps the most consequential change is the narrowing of the value added tax (VAT) exemption previously applicable to gambling and betting operators, specifically those making supplies comprising sports betting, casino and lottery services. As a result of this change, affected operators will be entitled to recover input VAT incurred in connection with the making of these supplies.”

SINGAPORE

PKF-CAP LLP

“The most significant, recent development making headlines and reshaping tax regulations – with significantly enhanced compliance obligations both at the local and global level – is the global minimum tax or, as it is commonly known, the Pillar Two programme, which is part of the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting (BEPS) 2.0 project. This is because most of the constituent entities that were part of the in-scope multinational enterprise (MNE) groups, and previously enjoyed many statutory tax incentives and exemptions, had a much lower effective tax rate compared to the statutory corporate tax rate, due to the various tax incentive programmes available locally.”

JAPAN

Deloitte Tohmatsu Tax Co

“The most significant tax measures in the financial year 2026 Tax Reform Act, which was enacted in March 2026, are the newly introduced immediate expensing regime for large-scale, highly profitable corporate investments and enhanced research and development (R&D) tax credits for strategic fields such as artificial intelligence (AI), semiconductors, quantum computing, biotechnology and space technologies. The Act also incorporates the Organisation for Economic Co-operation and Development’s (OECD’s) Side-by-Side Agreement into Japan’s global minimum tax rules under Pillar Two and expands the Japanese consumption tax to large-scale e-commerce platform operators.”

AUSTRALIA

Ernst & Young, Australia

“The Australian tax landscape has been unusually active over the past 12-18 months, with some of the most significant proposed changes to Australia’s income tax settings in many years. Important enacted measures include the implementation of the Organisation for Economic Co-operation and Development’s (OECD) Pillar Two global minimum tax regime, supported by new Australian Taxation Office (ATO) guidance and compliance frameworks for multinational groups, changes to capital gains tax (CGT) settings and negative gearing, and reforms affecting large superannuation balances (retirement schemes).”

UNITED ARAB EMIRATES

Grant Thornton UAE

“Over the last 12-18 months, the United Arab Emirates’ (UAE’s) tax framework has continued to mature from a newly introduced regime into a more sophisticated and internationally integrated system. While continued guidance across corporate tax, transfer pricing (TP) and value added tax (VAT) has enhanced administrative certainty, the broader shift has been toward stronger tax governance, greater emphasis on evidencing tax positions and more consistent regulatory administration.”

SOUTH AFRICA

Forvis Mazars

“South Africa’s tax landscape is entering a more enforcement-driven era, with the emphasis shifting from headline rate changes to smarter compliance, digitalisation and transparency. While improved revenue collections have created space for limited taxpayer relief, including inflationary adjustments and a higher value added tax (VAT) registration threshold, the more significant development is the South African Revenue Service’s (SARS’s) accelerated modernisation agenda. Through artificial intelligence (AI), data analytics, automated risk profiling and third-party data matching, SARS is becoming increasingly sophisticated in identifying non-compliance.”

CONTRIBUTORS

ATOZ Tax Advisers

Caplin & Drysdale

Deloitte Malta

Deloitte Tohmatsu Tax Co

Doane Grant Thornton LLP

Ernst & Young, Australia

Forvis Mazars

Grant Thornton

Grant Thornton UAE

PKF-CAP LLP

Potamitis Vekris

Riedweg & Partner AG

Studio Tributario e Societario – Deloitte