{"id":148420,"date":"2024-01-11T10:12:29","date_gmt":"2024-01-11T09:12:29","guid":{"rendered":"https:\/\/www.cde.ual.es\/?p=148420"},"modified":"2024-01-11T10:12:29","modified_gmt":"2024-01-11T09:12:29","slug":"a-new-era-of-corporate-taxation-in-the-eu-begins","status":"publish","type":"post","link":"https:\/\/www.cde.ual.es\/en\/a-new-era-of-corporate-taxation-in-the-eu-begins\/","title":{"rendered":"A new era of corporate taxation in the EU begins"},"content":{"rendered":"

On 1 January, ground-breaking new EU rules came into force introducing a minimum effective tax rate of 15% for multinational companies with activities in EU Member States.<\/strong><\/p>\n

\"\"<\/a><\/p>\n

Ground-breaking new EU rules come into effect today introducing a minimum rate of effective taxation of 15% for multinational companies active in EU Member States.<\/p>\n

The framework will bring greater fairness and stability to the tax landscape in the EU and globally, while making it more modern and better adapted to today’s globalised, digital world. The entry into force of the minimum effective taxation rules, unanimously agreed by Member States in 2022, formalises the EU’s implementation of the so-called \u2018Pillar 2′ rules agreed as part of the global deal on international tax reform in 2021.<\/p>\n

While almost 140 jurisdictions worldwide have now signed up to those rules, the EU has been a front-runner in translating them into hard law. By lowering the incentive for businesses to shift profits to low-tax jurisdictions, Pillar 2 curbs the so-called “race to the bottom”\u2014the battle between countries to lower their corporate income tax rates in order to attract investment. It is already delivering results, with a number of zero tax jurisdictions around the world having announced the introduction of a corporate income tax for the companies in scope.<\/p>\n

In detail<\/strong><\/p>\n

The rules will apply to multinational enterprise groups and large-scale domestic groups in the EU, with combined financial revenues of more than \u20ac750 million a year. They will apply to any large group, both domestic and international, with a parent company or a subsidiary situated in an EU Member State.<\/p>\n

The Directive includes a common set of rules on how to calculate and apply a ‘top-up tax’ due in a particular country should the effective tax rate be below 15%. If a subsidiary company is not subject to the minimum effective rate in a foreign country where it is located, the Member State of the parent company will also apply a top-up tax on the latter. In addition, the Directive ensures effective taxation in situations where the parent company is situated outside the EU in a low-tax country which does not apply equivalent rules.<\/p>\n\n\n\n
\"\"<\/a><\/p>\n

Parliament set to back global minimum corporate tax rate<\/a><\/h4>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Background<\/strong><\/p>\n

With this historic law, the EU’s pledge to be among the first to implement\u00a0the OECD tax reform<\/a>, has come to fruition. Ensuring a global minimum level of taxation for Minimum corporate taxation is one of the two work streams of the global OECD agreement (Pillar 2) – the other is the partial re-allocation of taxing rights (known as Pillar 1).<\/p>\n

The latter will adapt the international rules on how the taxation of corporate profits of the largest and most profitable multinationals is shared amongst countries, to reflect the changing nature of business models and the ability of companies to do business without a physical presence.<\/p>\n

More information: <\/strong>European Commission<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

On 1 January, ground-breaking new EU rules came into force introducing a minimum effective tax rate of 15% for multinational companies with activities in EU Member States. Ground-breaking new EU rules come into effect today introducing a minimum rate of effective taxation of 15% for multinational companies active in EU Member States. The framework will […]<\/p>\n","protected":false},"author":101011,"featured_media":148418,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[346,4079,4081],"tags":[11267,779,11266,11265,11264],"class_list":{"0":"post-148420","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-eu-news","8":"category-law","9":"category-legislation","10":"tag-corporate-taxation-en","11":"tag-eu-en","12":"tag-financial-revenues","13":"tag-large-scale-domestic-groups","14":"tag-multinational-enterprise-groups","15":"entry"},"acf":[],"yoast_head":"\nA new era of corporate taxation in the EU begins | CDE Almer\u00eda - Centro de Documentaci\u00f3n Europea - Universidad de Almer\u00eda<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.cde.ual.es\/en\/a-new-era-of-corporate-taxation-in-the-eu-begins\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A new era of corporate taxation in the EU begins | CDE Almer\u00eda - Centro de Documentaci\u00f3n Europea - Universidad de Almer\u00eda\" \/>\n<meta property=\"og:description\" content=\"On 1 January, ground-breaking new EU rules came into force introducing a minimum effective tax rate of 15% for multinational companies with activities in EU Member States. 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