From Features

International Tax

BEPS 2.0: Where Are We Now?

BEPS Two-Pillar Solution: Where Are We Now?

Dr Mona Baraké
EU Tax Observatory/ Paris School of Economics

In October 2021, a significant number of member jurisdictions of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) came together to reform global tax rules through a Two-Pillar solution. These reforms, often called BEPS 2.0, seek to tackle the tax challenges arising from the digitalisation of the economy, ensuring that multinational enterprises (MNEs) pay a fair share of taxes where they operate. The first Pillar gives taxing rights over MNEs’ profits to countries where the final users are through Amount A, while Pillar Two introduces a global minimum tax of 15% on MNEs’ profits.

Since initiating the Two-Pillar solution discussions, Pillar Two appears to be progressing toward coming into effect soon, with the EU and about sixteen countries planning to introduce the minimum tax as soon as 2024 and 2025. In contrast, the implementation of Pillar One seems to be paused.

Pillar Two: Imminent Implementation
Starting in January 2024, the EU and ten countries (Switzerland, United Kingdom, New Zealand, Liechtenstein, Japan, Canada, Australia, South Korea, Vietnam, Norway) are expected to adopt the 15 per cent minimum tax on MNEs with revenues of at least 750 million euros. By January 2025, additional countries such as Singapore, Malaysia, Thailand, Jersey, Guernsey, and Hong Kong, are anticipated to follow. Within the EU, member states have the option to postpone the introduction of the minimum tax for six years if they have no more than twelve MNEs in scope of the Pillar 2 Directive.

Under Pillar Two, countries have the choice to implement either the I…

BEPS 2.0: Where Are We Now?

The International Tax Reform Journey: Past — Present — Future

Manal Corwin
OECD Centre for Tax Policy and Administration

The international tax reform journey is the story of how and why countries collaborate on tax matters. The right to tax is fundamental to national sovereignty and is jealously guarded by national governments. Countries choose to collaborate on international tax rules and standards when collective action is necessary to secure or facilitate domestic policy objectives; or alternately, when the absence of collective action or coordination frustrates domestic objectives.

Increasing globalisation and digitalisation have multiplied opportunities and avenues for cross-border activities, putting pressure on the international tax architecture and creating new demands for collaboration. Further, increasing awareness of development financing needs has led to a collective interest among jurisdictions in coordinating to enhance the capacity of developing economies to mobilise resources to support growth and development.


The international tax reform journey has already come a long way. Governments have collaborated on international taxation for over 100 years, developing an agreed set of international tax rules that helped promote stability and growth by removing barriers to cross-border investment, while protecting domestic tax bases. However, during the global financial crisis, it became clear that this international tax architecture, developed in the “brick and mortar” economy a century prior, was no longer suited to the increasingly digitalised and gl…