The US Treasury Department announced revisions to the Global Anti-Base Erosion Information Return on September 11, 2026. The update introduces a side-by-side safe harbor mechanism, allowing US-headquartered multinational groups to prioritize domestic compliance over certain international tax rules.
Under the new framework, companies meeting domestic minimum tax thresholds can bypass key provisions of the OECD Pillar Two framework, specifically the Income Inclusion Rule and the Undertaxed Profits Rule. This change aims to reduce redundant paperwork and overlapping filing requirements that existed since the original return was adopted in January 2025.
The revised return also standardizes jurisdictional reporting to consolidate local filing demands. Additionally, it provides specific safeguards for US substance-based tax incentives, including protections for R&D tax credits, which are particularly relevant for the technology and manufacturing sectors.
These changes follow an OECD/G20 Inclusive Framework agreement from January 2026 involving over 145 countries, which coordinates the 15% global minimum corporate tax. Treasury Secretary Scott Bessent stated these revisions align with President Trump’s international tax objectives.
Experts note a potential risk of retaliation from trading partners who may view the safe harbor as an exemption from global commitments. Such a response could lead to the imposition of compensatory measures, potentially reinstating the compliance burdens the Treasury seeks to eliminate.
