Pillar One & Pillar Two
Building on years of international efforts to adapt tax rules to an increasingly digitalised economy, the OECD/G20 Inclusive Framework has reshaped the global tax landscape through its two pillar solution.
As part hereof, the OECD/ Inclusive Framework released the Pillar Two Rules at the end of December 2021, resulting in a 15% minimum tax rate for in-scope (multinational) groups in all jurisdictions where they have presence as early as of financial years 2024. These rules are by now introduced in many jurisdictions, imposing a global minimum tax and significantly expanding compliance and reporting obligations for (multinational) groups.
While the OECD has finalised the technical framework for Pillar One, implementation of Amount A remains uncertain due to the absence of global consensus. Amount B, by contrast, is incorporated in the OECD Transfer Pricing Guidelines and can be applied by jurisdictions to determine a return on sales for in-scope distributors.