On Wednesday, June 8, 2022, the IFA Liechtenstein Tax Association took place in Schaan. The general topic was "BEPS Pillar 2 – Introduction of a global minimum taxation". Prof. Dr. Michael Tumpel and Dr. Peter Bräumann of JKU Business School - University of Linz gave a talk on the conformity of the GloBE rules with national constitutional principles and the EU/EEA fundamental freedoms.
On Wednesday, June 8, 2022, the IFA Liechtenstein Tax Association took place in Schaan. The general topic was "BEPS Pillar 2 – Introduction of a global minimum taxation". Prof. Dr. Michael Tumpel and Dr. Peter Bräumann of JKU Business School - University of Linz gave a talk on the conformity of the GloBE rules with national constitutional principles and the EU/EEA fundamental freedoms.
BEPS Pillar 2 is a taxation concept that provides additional taxes to be applied to corporate profits if the effective tax burden is below the minimum rate of 15 percent. Minimum taxation is a further element in curbing tax competition between states, which is harmful from the OECD's point of view, and in ensuring fair taxation.
The OECD's GloBE rules apply to multinational corporate Groups with a consolidated annual turnover of at least EUR 750 million. For the business units belonging to the group (e.g. subsidiaries or permanent establishments) of a respective state, an effective tax rate (“ETR”) is based to calculate a specially defined tax base (“GloBE Income”). If the ETR is below 15%, the minimum tax level is to be achieved by levying a “top-up tax”. The "top-up tax" can essentially be levied in two ways: The Income Inclusion Rule ("IIR") or, subsidiary, the Undertaxed Profits Rule ("UTPR").
Prof. Dr. Michael Tumpel and Ass.-Prof. Dr. Peter Bräumann JKU Business School shed light on the conformity of the GloBE rules with national constitutional principles and the EU/EEA fundamental freedoms. In their view, it will be necessary to clarify with the courts whether it is justified to tax multinational corporate groups with annual sales of EUR 750 million more than those with annual sales of less than EUR 750 million or single or purely domestic company structures. The consensus of the panel discussion that followed was that the minimum taxation will bring a dynamic into the international tax world, which presents the actors with new challenges.
You can find more information under: https://www.ifa-fl.li/2022/06/08/fachymposium-pillar2-2022/, opens an external URL in a new window
