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Press Release

EU moves forward with 15% corporate tax rate

EU Member States have reached unanimous agreement to implement the EU Commission’s proposal for a Directive ensuring a minimum effective corporate tax rate for large multinational groups.  The proposed rules, known as Pillar Two, will provide for a minimum 15% corporate tax rate for multinationals with global turnover in excess of €750 million.

The Council Directive, yet to be formally adopted, includes a common set of rules on how to calculate the 15% effective minimum tax rate, so that this is properly and consistently applied across the EU.

Member States must implement the Pillar Two rules by 31 December 2023.

In our view, the announcement is welcome as it comes at a time when some EU Member States had indicated a willingness to take unilateral steps to implement the Pillar Two rules in the absence of unanimous agreement at EU level.  Overall, it is very positive news as the EU Directive should provide consistency of application of the Pillar Two rules across the EU Member States.  However, it remains to be seen how this will be balanced with the administrative cost burden of implementation for global businesses.

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