IFRS Talks - PwC's Global IFRS podcast
November 2023 Global minimum tax
Nov 8, 2023
Exploring the OECD's global minimum tax rules to combat tax avoidance by multinational enterprises, focusing on practical challenges and accounting implications. Delving into the complex criteria and calculations of the global minimum tax, addressing adjustments in financial statements and relief provided by the ISP. Discussing the impact on accounting practices, such as impairment testing and tax expense allocation within groups. Highlighting the importance of qualitative disclosure information for investors and available resources for staying up-to-date on tax regulations.
28:22
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Quick takeaways
- Global minimum tax aims to stop tax rate reductions by multinational corporations.
- Shift to consolidated financial statements needed for accurate global tax rate calculation.
Deep dives
The Origin of Global Minimum Taxes
Global minimum tax rules, known as pillar two, emerged from the initiative to address base erosion and profit shifting within the OECD. This initiative aimed to halt the competition of reducing tax rates among multinational corporations. The concept includes two key rules: the income inclusion rule and the under tax payments regime, designed to ensure a minimum tax rate globally.
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