Peter Barnes Comments on Pillar One Amount B in Law360

As OECD-led negotiations continue on a taxing rights overhaul known as Pillar One after a missed June deadline, the U.S. Treasury Department is working to extend the political agreement between it and several countries to nullify their digital services taxes once the rights overhaul is implemented.

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Even if the U.S. succeeds in securing a mandatory Amount B, there are likely to be disputes over the scope of the new transfer pricing approach. Corporations "will still be at risk in audits because countries will argue that the taxpayers' activities exceed the boundaries of the activities covered by Amount B," according to Peter Barnes, Of Counsel with Caplin & Drysdale.

Barnes said a mandatory Amount B remains important to U.S. negotiators to deliver something to U.S.-based multinationals they could benefit from. "Treasury needs to have something, anything, that will benefit U.S. companies," he said.

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