A Guide for Developing Countries on How to Understand and Adapt to the Global Minimum Tax: Draft for Consultation

Christians, Allison; Lassourd, Thomas; Mataba, Kudzie; Ogbebor, Eniye; Readhead, Alexandra; Shay, Stephen E.; Pouga, Zach

doi:10.2139/ssrn.4317112

SSRN Journal

2022

DOI: 10.2139/ssrn.4317112

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A Guide for Developing Countries on How to Understand and Adapt to the Global Minimum Tax: Draft for Consultation

Allison Christians

Thomas Lassourd

Kudzie Mataba³

et al.

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2024

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“…R&D tax incentives have also been increasingly used over the past two decades (González Cabral et al, 2023 [26]; OECD, 2023 [70]). There is a large body of evidence that tax incentives can deliver very low ETRs (Botman, Klemm and Baqir, 2008 [71]; González Cabral, Appelt and Hanappi, 2021 [72]; Celani, Dressler and Hanappi, 2022 [73]; Egger, Strecker and Zoller-Rydzek, 2020 [28]).…”

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The Global Minimum Tax and the taxation of MNE profit

2024

OECD Taxation Working Papers

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The Global Minimum Tax (GMT) introduces significant changes to the international tax architecture and thereby to the taxation of large multinational enterprises. This paper assesses the impact of the GMT using new and unique data on MNE worldwide activity building on comprehensive estimates of global low-taxed profit.The paper has four main findings. First, the GMT reduces the incentives to shift profits, resulting in an estimated fall in global shifted profits by around half. Second, the GMT will reduce low-taxed profit worldwide through reduced profit shifting and top-up taxation. The global amount of MNE profit taxed below the 15% minimum effective rate is estimated to fall by more than two thirds. Third, the GMT is estimated to increase CIT revenues by USD 155-192 billion per year, or between 6.5-8.1% of current global CIT revenues. The distribution of these gains across jurisdictions strongly depends on the implementation choices of governments. Finally, the GMT is estimated to reduce tax rate differentials across jurisdictions. This could have potentially important impacts on the efficiency of the global allocation of investment and economic activity.

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The Global Minimum Tax and the taxation of MNE profit

2024

OECD Taxation Working Papers

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A Guide for Developing Countries on How to Understand and Adapt to the Global Minimum Tax: Draft for Consultation

Cited by 1 publication

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The Global Minimum Tax and the taxation of MNE profit

The Global Minimum Tax and the taxation of MNE profit

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