Pillar Two Side-by-Side: Has the OECD Finally Found Its Stride?

On January 5, 2026, the OECD released comprehensive guidance on Pillar Two, including the much-anticipated Side-by-Side Safe Harbor. How does (and does not) the Side-by-Side Safe Harbor protect U.S. multinationals from the substantive and compliance costs of GloBE?  Is the Side-by-Side Safe Harbor permanent and could countries other than the U.S. qualify?  Who does the UPE Safe Harbor protect? How does the package address the expiration of the Country-by-Country Safe Harbor in 2027 and what is the permanent solution provided for in the package? How does the guidance change the treatment of substance-based credits like the U.S. R&D credit?  Lastly, how stable is the Pillar Two system going forward; does exempting the U.S. secure its future, or is it the first hole in the dam? 

Join us as our hosts Gary Scanlon and Kristen Gamboa interview Michael Plowgian (Co-Principal in Charge, KPMG Washington National Tax - International Tax), along with Conrad Turley (Tax Policy Leader and Chair of the Global Tax Policy Leadership Group - KPMG Global), and Alistair Pepper (Managing Director, KPMG Washington National Tax - Economic & Valuation Services) to answer these questions and more on the latest episode of Inside International Tax.