OECD Announces Conceptual Agreement In BEPS 2.0 Project

Executive summary

On 1 July 2021, at the conclusion of two days of virtual meetings of the OECD¹/G20² Inclusive Framework on BEPS³ (the Inclusive Framework), the OECD released a Statement on a Two-Pillar Solution to Address the Tax Challenges Arising From the Digitalisation of the Economy (the Statement), which reflects agreement of 130 of the member jurisdictions of the Inclusive Framework in connection with the BEPS 2.0 project. The nine members of the Inclusive Framework that have not joined the Statement are Barbados, Estonia, Hungary, Ireland, Kenya, Nigeria, Peru, Saint Vincent and the Grenadines, and Sri Lanka.

The Statement describes agreed components with respect to both elements of the BEPS 2.0 project: Pillar One on revisions to nexus and profit allocation rules and Pillar Two on new global minimum tax rules. The Statement further indicates that remaining issues and a detailed implementation plan will be finalized by October 2021.