Draft Law Transposing Pillar Two Presented To Parliament.

Introduction

On 4 August 2023, the text of the draft law (the "Draft Law") transposing the Council Directive (EU) 2022/2523 of 14 December 2022 on ensuring a global minimum level of taxation for multinational enterprise ("MNE") groups and large-scale domestic groups in the Union (the "Directive") was presented to Parliament. This Directive implements the Global Anti-Base Erosion ("GloBE") rules, also called "Pillar Two", agreed upon by the OECD/G20 Inclusive Framework on BEPS in the Statement to Address the Tax Challenges Arising from the Digitalisation of the Economy and the Detailed Implementation Plan, on 8 October 2021.

To ensure that large internationally operating businesses pay a minimum level of tax regardless of where they are headquartered or the jurisdictions they operate in, Pillar Two introduces a global minimum corporate tax rate set at 15% through a top-up tax using an effective tax rate test calculated on a jurisdictional basis and using a