Background
The OECD Inclusive Framework on BEPS (IF) published a statement
on implementing a two-pillar solution under BEPS 2.0 back in
October 20211. The statement mentioned
that “…… consideration will be given
to the conditions under which the US Global Intangible
Low-Taxed Income (GILTI) regime will co-exist with the GloBE
rules, to ensure a level playing field”. Since
then, no significant development on the GILTI/GloBE rules
co-existence mechanism has taken place while over 55
jurisdictions2 have already implemented or are
planning to implement the GloBE rules or a Qualified Domestic
Minimum Top-up Tax (QDMTT) with effect from 2024 or 2025.
Under the GloBE rules or a QDMTT, the domestic and foreign
low-taxed profits of US MNE groups could be subject to top-up taxes
in the foreign jurisdictions despite such profits may have been
subject to minimum corporate taxation in the US. Earlier this year,
the US expressed concerns about the Pillar 2 rules and
