KPMG article: Evaluating possible U.S. retaliatory tax measures
Key issues presented by four retaliatory tax measures now under consideration by President Trump and Congress to respond to discriminatory or extraterritorial taxes imposed by foreign countries.
The Trump administration repeatedly has stated its intention to respond more muscularly to discriminatory and extraterritorial tax measures imposed against U.S. multinational groups. This is widely understood as a reference to digital services taxes, which discriminate against U.S. businesses that dominate the tech sector, and the undertaxed profits rule, which is designed to give countries taxing rights over profits realized in other jurisdictions (including the United States) that are determined to be low-taxed and not subject to tax through another Pillar Two charging mechanism. While tariffs are a highly publicized tool for responding to countries’ overreach in the tax domain, it is also no secret that the president and Congress are considering retaliatory tax measures.
Read an April 2025 article* prepared by KPMG LLP tax professionals that explores some key issues presented by four retaliatory tax measures now under consideration by President Trump and Congress to respond to discriminatory or extraterritorial taxes imposed by foreign countries.
*This article appears in Tax Notes Federal (April 21, 2025) and is provided with permission.