|Author (Corporate)||European Commission: DG Taxation and Customs Union|
|Series Details||COM (2021) 823|
|Content Type||Blog & Commentary, News, Policy-making|
Legislative initiative tabled by the European Commission on 22 December 2021, aimed at ensuring a minimum effective tax rate for the global activities of large multinational groups.
In October 2021, the OECD/G20 Inclusive Framework (IF) on Base Erosion and Profit Sharing (BEPS) agreed on a global consensus-bases solution aimed at addressing tax challenges relating to the digital economy. Minimum corporate taxation was one of the two work streams agreed by members of this working group. The work culminated in a global agreement among 137 jurisdictions.
The proposed Council Directive aims to deliver on the European Union's pledge to be among the first to implement this global tax reform agreement. It lays down rules for ensuring minimum level of effective corporate taxation of large multinational groups and large-scale purely domestic groups operating in the EU's Single Market. It sets out how the principles of a 15% effective tax rate is to be applied in practice within the EU, and it includes a common set of rules on how to calculate this tax rate so that it is properly and consistently applied across the EU. The proposal also follows closely the OECD Model Rules agreed by the IF and published on 20 December 2021.
The draft Directive was tabled by the European Commission on 22 December 2021.
|Keywords||Harmonisation | Standardisation, Tax Avoidance | Fraud | Evasion
|International Organisations||European Union [EU]|