OECD still sees total commitment from countries to finalise global tax pact

The Organisation for Economic Cooperation and Development (OECD) still sees total commitment from countries seeking to wrap up a global tax pact on highly profitable multinationals, its head of tax said, after months of delays and hesitation by some big countries.
 

Officials from nearly 130 countries and jurisdictions missed a mid-year deadline to finalise the terms of an international treaty that reallocates taxing rights across borders mainly on U.S. big digital companies, leaving its future in limbo.
 

The pact, the first of a two-pillar cross-border corporate tax overhaul agreed in 2021, aims to replace unilateral digital services taxes with new rules for sharing taxing rights on companies such as Alphabet's Google and Amazon.com and Apple.
 

"There is 100 per cent commitment among members to get it done," OECD tax director Manal Corwin told journalists.
 

"The sense of urgency is high and certainly getting something before the end of the year would be a top priority of mine," she added.
 

Washington has said that India, China and Australia remain hold-outs on U.S. demands over alternative ways to calculate transfer pricing.
 

Meanwhile, countries have begun implementing the second pillar of the 2021 global tax deal, under which they agreed to set a 15 per cent minimum corporate tax rate or apply a top-up levy for big multinational s booking profits in countries with lower rates.
 

As part of implementation of the second pillar, a first wave of 19 countries signed on Thursday or committed to sign a treaty that allows developing countries to tax some outbound intra-company payments that otherwise could be made with little or no tax, the OECD said.
 

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)