The OECD/G20 Inclusive Framework on BEPS has concluded negotiations on a new multilateral instrument that will protect the right of developing countries to ensure multinational enterprises pay a minimum level of tax on a broad range of cross-border intra-group payments, including services.
The new Multilateral Convention to Facilitate the Implementation of the Pillar Two Subject to Tax Rule will enable developing countries to tax certain intra-group payments in instances where these payments are subject to a nominal corporate income tax rate below 9%. The subject to tax rule (STTR) allows source jurisdictions – those in which covered income arises – to impose a tax where they otherwise would be unable to do so under the provisions of tax treaties.
The OECD/G20 Inclusive Framework on BEPS has concluded negotiations on a new multilateral instrument that will protect the right of developing countries to ensure multinational enterprises pay a minimum level of tax on a broad range of cross-border intra-group payments, including services.
The new Multilateral Convention to Facilitate the Implementation of the Pillar Two Subject to Tax Rule will enable developing countries to tax certain intra-group payments in instances where these payments are subject to a nominal corporate income tax rate below 9%. The subject to tax rule (STTR) allows source jurisdictions – those in which covered income arises – to impose a tax where they otherwise would be unable to do so under the provisions of tax treaties.
