TaxProf Blog

Pasquale Pistone (Visiting Professor, NYU; Academic Chairman, IBFD (The Netherlands); Professor of Tax Law, University of Salerno (Italy); Jean Monnet ad Personam Chair in European Tax Law & Policy, WU Vienna (Austria); Google Scholar) presents The Implications of Pillar II (Globe) for Developing Countries at Boston College today as part of its Tax Policy Workshops hosted by Jim Repetti: 

The desirable global tax governance goal of preventing the race to the bottom should not justify the bias that the Pillar II version of GloBE might in some cases to produce in favour of domestic over foreign investment. By neutralizing tax incentives in cross-border, but not in domestic situations, the GloBE top-up tax (IIR) puts developing countries, which mostly rely on foreign capital, at a systematic disadvantage when their tax incentives reduce corporation taxes below the global corporate minimum rate. This hidden collateral effect of GloBE might undermine the right of such countries to remain the masters of their international tax policy decisions and pursue their economic development without external interferences. For such reason, it might be questioned from the perspective of fairness and legitimacy.