2026 Global Tax Policy Survey

A. The biggest challenge comes from the rising tide of complexity in the tax system. While some of it can be attributed to sources such as Pillar Two and the EU Carbon Border Adjustment Mechanism, a lot of complexity also comes from inconsistent domestic implementation of international regimes. The volume of public tax transparency disclosures stemming from a combination of regulatory requirements and voluntary disclosures, adds further pressure and is expected to increase in coming years.

A. Tax Administration 3.0, an OECD model of digital tax administration where tax compliance processes are built into taxpayers’ natural systems so that ‘tax just happens’, is ultimately expected to make life easier for both taxpayers and tax authorities, and this is recognized by the survey respondents.

Respondents expect to see positive impacts including:

• AI-based tax compliance software to improve accuracy.
• Tax Administration 3.0 will require less time and resources to be spent on compliance.
• E-invoicing will lead to simpler compliance. 

However, the transition itself demands more investment in the short term and adds complexity for some.

This was particularly evident for e-invoicing: the number of respondents expecting simpler compliance has shrunk over the past two years, while the expectation of significant initial investment as the main impact has increased.

For tax digitalization to deliver simpler compliance, it needs more than new technology – the quality of underlying data, the right IT infrastructure, and the ability to embed tax into wider business systems and processes are all critical.

A. Pillar Two now enters the implementation phase, the greatest impact on multinationals will come through the burdens involved in complying with the new rules. 

88% of respondents now expect to pay more overall tax as a result pf Pillar Two. However, the proportion of respondents who expect to pay only marginally more tax (56%) continues to outstrip those expecting to pay meaningfully more tax (32%).

While the additional Safe Harbours from the Side-by-Side package have been welcomed as delivering some simplification, more is needed as 41% of respondents still see further simplification as a key future priority for international coordination.

Even though additional tax liability is expected to be modest, with only 32% expecting to pay meaningfully more tax, compared with 56% expecting only a marginal increase, the compliance workload remains substantial. For most multinationals, the strategic question is therefore not how much more they will pay, but how to efficiently organize their Pillar Two compliance process.

With the first filing deadline coming up at the end of June, both businesses and tax authorities are fully focused on the practicalities of compliance – the “common understanding” recently published by the OECD provides a welcome transitional relief where the filing portals or exchange relationships are not quite ready.

A. Tax incentives are likely to become more important across different policy areas.  Following the agreement of Pillar Two and, in particular, the substance-based tax incentive Safe Harbour, governments are likely to rely more on tax incentives as a competitiveness lever. This is positive for businesses - 38% of survey respondents expect new incentives to emerge while 57% think existing incentives will remain valuable to them because of this new Safe Harbour.

Faced with increased global mobility, governments are increasingly using tax incentives to attract foreign talent, with 57% of respondents seeing a growth in the use and value of these policy tools.

Tax incentives are also at the heart of many sustainability policies, with 34% of respondents making full use of the incentives, grants and reliefs available, while 59% are exploring their use.