G7 Statement on Global Minimum Tax
The G7 has issued a statement on the global minimum tax framework developed under the OECD/G20 Inclusive Framework, announcing that they have reached a shared understanding, further to the proposed changes to the international tax system in the United States and the success of Qualified Domestic Top-up Tax (QDMTT) implementation and its impact in tackling base erosion.
This shared understanding is based on the following accepted principles:
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A side-by-side system would fully exclude U.S. parented groups from the UTPR and the IIR in respect of both their domestic and foreign profits.
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A side-by-side system would include a commitment to ensure any substantial risks that may be identified with respect to the level playing field, or risks of base erosion and profit shifting, are addressed to preserve the common policy objectives of the side-by-side system.
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Work to deliver a side-by-side system would be undertaken alongside material simplifications being delivered to the overall Pillar 2 administration and compliance framework.
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Work to deliver a side-by-side system would be undertaken alongside considering changes to the Pillar 2 treatment of substance-based non-refundable tax credits that would ensure greater alignment with the treatment of refundable tax credits
See the Statement by the OECD Secretary General, welcoming the G7 Statement.