Major reform of the international tax system was completed today at the OECD to ensure all Multinational Enterprises (MNEs) will be subjected to a minimum 15% tax rate from 2023.
- The landmark agreement will also reallocate over $125 billion of profits from nearly 100 of the world’s largest and most profitable MNEs to nations globally, ensuring that these firms pay a fair share of tax where they operate and generate earnings.
- After years of intensive engagements to modernize the international tax system, 136 out of 140 jurisdictions updated and finalized a July political agreement by members to reform international tax rules.
- The deal is now supported by all OECD and G20 countries after Estonia, Hungary, and Ireland joined the agreement.
- The two-pillar solution will be presented at the G20 Finance Ministers meeting in Washington D.C. on 1 October.
The global minimum tax agreement seeks to multilaterally agree on limitations on it and will see countries collect nearly $150 billion in new revenues annually.
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