Digitalization of the Global Economy: The Bigger Picture

    View Author November 2019

    OECD Publishes a Public Consultation Document on the Global Anti-Base Erosion Proposal (Pillar Two)

    A month after unveiling its proposal for a “Unified Approach” to Pillar One of the work program on tax and digitalization, the OECD Secretariat has issued a public consultation document on Pillar Two, the proposed global minimum tax regime (GloBE).

    The Pillar Two consultation document welcomes general comments on the proposal, but it concentrates on issues in three areas, namely (a) determining the foreign income tax base, (b) the blending (or non-blending) of foreign income taxes, and (c) the scope, carve-outs and thresholds. There is still little clarity on how the Pillar Two rules would work in practice. Much important work remains during the months ahead.

    This client update summarizes the Pillar Two consultation document and comments on certain aspects of it.