The OECD/G20 Inclusive Framework on base erosion and profit shifting (BEPS) today, 12 October 2020, released a report under Pillar Two—a “Blueprint” or report on the tax challenges arising from digitalization.
While the Pillar Two Blueprint was approved by the OECD/G20 Inclusive Framework on BEPS, it does not reflect an agreement but provides a “solid basis” for a future agreement. The initial timeline for the work had contemplated an agreement by the end of 2020, but the Inclusive Framework’s stated goal is now to “bring the process to a successful conclusion by mid-2021”.
The Pillar Two Blueprint proposes a set of rules that attempt to determine that large internationally operating businesses pay a minimum level of tax regardless of where they are headquartered or the jurisdictions in which they operate, and proposes four new rules to accomplish this goal.
Read an October 2020 report [PDF 1.1 MB] prepared by KPMG LLP that provides an initial analysis of the Pillar Two Blueprint
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