The Global Minimum Tax | Selected Issues on Pillar Two

S. 2221. Introduction

The Pillar Two Model Rules, also known as “Global Anti-Base Erosion” or “GloBE” Model Rules (in the following referred to as “Pillar Two”, “GloBE Model Rules”, or “GloBE”), are designed to ensure that “large multinational enterprises pay a minimum level of tax on the income arising in each jurisdiction where they operate”. To fall within the scope of GloBE Model Rules, taxpayers must have a foreign presence and generate more than EUR 750 million in consolidated revenues. Contrario sensu, taxpayers with no foreign presence or less than EUR 750 million in consolidated revenues are not within the scope of the GloBE Model Rules.

This contribution aims to analyze the scope of Pillar Two by carefully examining the intended targets of this minimum global tax which are multinational enterprises groups (in the following “MNE groups” or “MNEs”). In that sense, it begins with an analysis of the MNE group definition followed by an examination of the different features of an MNE group regarding their structural and legal aspects. To that end, this segment will explore the various components that create such groups and explain their importance within the GloBE Model Rules.

Furthermo...