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CA Final · Direct Tax Laws & International Taxation · Latest Developments in International Taxation

Pillar Two of the OECD/G20 Inclusive Framework introduces a global minimum tax. Which minimum effective tax rate does the GloBE (Global Anti-Base Erosion) model rules use as the benchmark for in-scope multinational groups?

The GloBE rules under Pillar Two use a 15% minimum effective tax rate. Where a group's effective rate in a jurisdiction falls below 15%, a top-up tax applies. It covers multinational groups with consolidated revenue of at least EUR 750 million.

  1. A10%
  2. B15%Correct
  3. C20%
  4. D25%

Explanation

The GloBE rules set a minimum effective tax rate of 15% for multinational enterprise groups with consolidated revenue of at least EUR 750 million. If the jurisdictional effective rate is lower, a top-up tax is charged. The other rates are not the Pillar Two benchmark.

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