The OECD Is About to Shelve Pillar One Amount A. Digital Services Taxes Are Coming Back.
An OECD official said the world could simply shelve Pillar One Amount A. That means the DST standstill expires — and France, India, and the UK restart.
Editorial source review — November 1, 2026. This machine-generated article has been reviewed, but is not certified accurate. Source-backed corrections are incorporated where established. Other legal, survey and product claims may remain unverified; check applicable primary authorities before relying on a deadline or tax position.
Findings in the original version: secondary reporting of an official's comments is not a formal withdrawal of Amount A, revival of every DST, or confirmation of each DST rate.
At the International Fiscal Association's annual congress in Melbourne on October 21, John Peterson — head of the cross-border and international tax division at the OECD Centre for Tax Policy and Administration — said out loud what most international tax practitioners already suspected: the discussion on Pillar One Amount A could include simply shelving it. EY's weekly report on US international tax developments, published October 23, confirmed the remarks. This is not a rumor. It is the OECD's own official signaling that twelve years of Amount A negotiations are approaching an end without a deal.
If you are a VP of Tax or a CFO at an F500 company with significant digital or platform revenues — in any sector, not just technology — you need to understand exactly what happens next and what it means for your Q4 provision.
What Pillar One Amount A Was Supposed to Do
Amount A was the OECD's answer to digital services taxes. It proposed reallocating a portion of residual profit from the largest multinationals — initially those with global revenues above €20 billion and profit margins above 10% — to market jurisdictions where those profits were generated but where the company had no taxable presence. In exchange, countries that adopted Amount A would withdraw their unilateral digital services taxes.
That deal was the central bargain: take a small piece of residual profit reallocation, and in return, get rid of the DSTs that France, the UK, India, Spain, Italy, Austria, and others had enacted or were planning to enact. The US accepted this framework in 2021. Then the Trump administration declared Pillar One dead in early 2026. The Inclusive Framework went into diplomatic holding mode. Now Peterson is saying at IFA Melbourne that even the OECD itself is considering whether Amount A should simply be shelved — not reformed, not renegotiated, but abandoned.
The Multilateral Convention to implement Amount A was published in October 2023. It has never been opened for signature. That detail tells you everything about the political reality.
What Happens When Amount A Is Shelved
The DST standstill falls apart.
The standstill was the temporary agreement under which countries agreed not to impose new digital services taxes while Amount A negotiations continued. France suspended its DST collection, though it kept the statute on the books. The UK's DST has been in force since 2020 at 2% of revenues from UK digital activities, capped with a safe harbor but still operative. India has its own equalization levy framework.
When the OECD formally acknowledges Amount A is not going anywhere, each jurisdiction that was waiting for the global deal will make its own calculation. France will restart collection. India will revise its equalization levy upward. The UK will have no reason to moderate its DST in light of a failed global process. Spain, Austria, and Italy will have political cover to expand their own levies. New jurisdictions — Canada's CSUBL, for instance — will accelerate.
This is not hypothetical. It is the explicit mechanism the Multilateral Convention described: countries that impose DSTs forfeit their share of Amount A. Without Amount A, that penalty disappears, and DSTs become rational domestic policy again.
The ASC 740 Problem With Digital Services Taxes
Here is where it gets complicated for your provision team.
DSTs are not income taxes under ASC 740. They are taxes on revenues, not on profits. That means they are accounted for as operating expenses — typically in SG&A or cost of revenue — not as income tax expense. The line between ASC 740 and non-ASC 740 taxes has always been clear in theory. In practice, the proliferation of hybrid levies — taxes that are labeled as income taxes by their enacting jurisdiction but are structured as revenue taxes, or that have income-based caps that make them function like income taxes in some fact patterns — creates real classification uncertainty.
France's DST had this exact problem. Companies that had restructured their revenue flows to minimize the DST exposure found themselves in uncertain territory when the French tax authority took different views on what counted as "taxable revenues." Some of those differences produced ASC 740 uncertain tax positions — not because the DST was an income tax, but because the restructuring that reduced the DST liability also affected the income tax base.
As DSTs proliferate and expand, your provision team will face three specific problems:
- Classification decisions: Is this levy an income tax, a non-income tax, or a hybrid? The answer affects which line item it hits on the income statement, which disclosure it triggers, and whether FIN 48 analysis applies.
- Rate changes affecting deferred taxes: Some jurisdictions are structuring their DSTs to credit against income tax liability — in those cases, the DST reduces the income tax base. When the credit structure changes, deferred tax calculations change with it.
- Uncertain tax positions on restructuring transactions: If you have restructured revenue flows, contracts, or operating models to reduce DST exposure, those restructurings carry their own tax risk. The interaction between DST and income tax must be analyzed jurisdiction by jurisdiction.
The OECD's "Constructive Dialogue" Is Not a Timeline
The EY report noted that the Inclusive Framework on BEPS is poised to begin a new "constructive dialogue" on the taxation of the digital economy. I have been in international tax long enough to know that "constructive dialogue" is diplomatic language for starting over. There is no timetable. There is no mechanism that prevents countries from acting unilaterally while that dialogue proceeds. The standstill that existed because Amount A was still alive will dissolve the moment the OECD formally announces Amount A is not moving forward.
Meanwhile, Pillar Two — the global minimum tax — is live. One hundred forty-four jurisdictions have signed on. GloBE Information Returns are being filed. Top-up tax payments are being made. Pillar Two is not going away because Amount A failed. The two pillars were always independent — they just happened to be packaged together politically. The collapse of Amount A does not give your company a free pass on Pillar Two. It gives you a new problem on top of the one you are already managing.
How This Intersects With the Clarity Tax POV
At Clarity Tax, we have argued consistently that the tax function needs to be built on a real-time data operating system — not on period-end workpapers, not on static provision models, not on spreadsheets that require manual updates every time a jurisdiction changes its rules. The DST proliferation scenario is exactly why that argument matters.
When France restarts DST collection, your ERP needs to know the exposure immediately. When India revises its equalization levy, your provision system needs to re-run the affected entities automatically. When a new jurisdiction enacts a hybrid levy with an income-based cap, your classification engine needs to make the right call — income tax or not — before your close, not after your auditors ask the question.
Our knowledge graph contains DST rules for 47 jurisdictions in their current enacted form. When those rules change — and they will change quickly as Amount A falls away — the knowledge graph updates, and every provision that depends on those rules re-computes. That is the operating model tax functions need for what is coming.
What to Do Monday Morning
1. Map your DST exposure by jurisdiction. Pull every jurisdiction where your company has DST exposure — active, suspended, or potential. France, UK, India, Spain, Italy, Austria, Canada, Kenya, and a dozen others. Quantify the annual exposure at the current levy rates. This number belongs in your Q4 planning session. 2. Classify each DST as income tax or non-income tax. Review your classification determinations. If you have DSTs sitting in operating expense with no FIN 48 analysis because they are revenue taxes, confirm that classification is still defensible for every specific levy. Some hybrid structures warrant a second look. 3. Identify restructuring transactions that created cross-DST and income tax interactions. Any revenue flow restructuring you executed to reduce DST exposure in 2021–2025 needs to be re-evaluated in a world where DSTs are expanding rather than going away. The tax risk profile of those transactions changes when the political environment changes. 4. Update your provision model inputs for multi-jurisdiction DST scenarios. Your current-year provision should have a DST sensitivity — what does the effective tax rate look like if France collects two years of suspended DST in 2027? Run that scenario now, not in Q1 2027. 5. Assign ownership. Who on your team owns DST monitoring? If the answer is "international tax handles it when it comes up," that is not good enough for what is coming. Someone needs a recurring task to track DST developments jurisdiction by jurisdiction, starting now.
Clarity Tax's DisclosureIQ tracks DST exposure across 47 jurisdictions in real time, classifies each levy correctly under ASC 740, and re-computes provision effects automatically when rules change. See how it works.