The next phase of Pillar 2 implementation creative competition by Mindy Herzfeld
By: Herzfeld, Mindy
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Material type: 
ArticlePublisher: 2024Subject(s): SEGUNDO PILAR (OCDE) | ESTADOS UNIDOS
In:
Tax Notes International v. 114, n. 12, June 12 2024; p. 1727-1732Summary: Advocates for a global corporate minimum tax promised that it would bring international tax harmonization and reduce — if not eliminate — tax competition. As countries consider how to revise their domestic rules in light of the OECD global anti-base-erosion (GLOBE) agreement and the EU minimum tax directive, it’s becoming increasingly clear that the inclusive framework agreement on pillar 2 will result in neither of those outcomes. The latest iteration of pillar 2 implementation reveals the variability and creativity of countries’ responses as they seek to ensure that they can continue to attract both domestic and foreign investment and that formal adoption of the GLOBE rules won’t result in a loss of business investment, revenue, or jobs. The OECD, in drafting the GLOBE model rules and accompanying guidance, already anticipated that countries might try to evade requirements that countries subject corporate profits to a minimum level of tax. It warned that aggressive responses might violate the terms of the agreement. Countries must now walk a fine line between adhering to the formalities of what they agreed to and maximizing their attractiveness to business investment.
| Item type | Current location | Home library | Call number | Status | Date due | Barcode |
|---|---|---|---|---|---|---|
| Artículos | IEF | IEF | OP 138-Bis/2024/114/12-2 (Browse shelf) | Available | OP 138-Bis/2024/114/12-2 |
Advocates for a global corporate minimum tax promised that it would bring international tax harmonization and reduce — if not eliminate — tax competition. As countries consider how to revise their domestic rules in light of the OECD global anti-base-erosion (GLOBE) agreement and the EU minimum tax directive, it’s becoming increasingly clear that the inclusive framework agreement on pillar 2 will result in neither of those outcomes. The latest iteration of pillar 2 implementation reveals the variability and creativity of countries’ responses as they seek to ensure that they can continue to attract both domestic and foreign investment and that formal adoption of the GLOBE rules won’t result in a loss of business investment, revenue, or jobs. The OECD, in drafting the GLOBE model rules and accompanying guidance, already anticipated that countries might try to evade requirements that countries subject corporate profits to a minimum level of tax. It warned that aggressive responses might violate the terms of the agreement. Countries must now walk a fine line between adhering to the formalities of what they agreed to and maximizing their attractiveness to business investment.
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