Cees-Frans Greeven
Managing Partner | Lawyer
Send me an e-mail
+31 (0)20 333 8390 /+352 (0)2644 0919 21
It was a landmark decision by over 135 members of the G20/OECD Inclusive Framework on 8 October 2021 to agree on a global tax reform including a global minimum level of taxation of 15% for large multinational groups (consolidated group revenue of EUR 750 million or more). This resulted in the release by the OECD on 20 December 2021 of its Pillar Two Model Rules.
On 22 December 2021, the European Commission presented a proposal for a Directive (“Proposal”) which aims to implement the Pillar Two Model Rules in a way which is consistent and compatible with EU law. Decision making at the EU level on the Proposal however has been halted because of political blocking by first Poland and later Hungary.
On 12 December last it has been announced that political agreement has been reached on the Proposal. Subject to formal adoption of the Proposal - which is likely to take place very soon - Member States shall have to adhere to an exceptionally ambitious timeline. The Proposal must be implemented in domestic legislation before 31 December 2023 with effective date 1 January 2024.
In anticipation of the adoption of the Proposal, the Dutch government – as first EU member state - already launched a public consultation on 24 October 2022 on a draft bill to implement the Pillar 2 Model Rules. The draft legislation closely follows the Pillar 2 Model Rules as well as the Proposal. The consultation closed on 5 December last. It is expected that after review of the comments brought forward in the consultation process, draft legislation will be submitted to Parliament after having obtained advice from the Council of State. This is expected to take place in Q2 2023.
Some elements of the draft bill as presented by the Dutch government are:
Corporate income taxpayers now must start making preparations and analyze the consequences of these far-reaching legislation. One of the complicating factors is that many technical elements, guidance and documentation of the Pillar Two Model Rules which serve as the main reference for the Proposal is still under discussion and negotiation in Paris at the OECD.
Follow us!
Subscribe newsletter LinkedIn