BEPS 2.0: What Should the Board Know About Global Tax Reform and the Two Pillar Program?

Key Takeaways:

• Pillar Two comes in effect for accounting periods beginning on or after 1 January 2024 for multi-national companies with global revenue in excess of Euro 750m.
• Complexity will arise from both the detailed calculations involved as well as timing related to the phased-in approach by jurisdiction as to when each country will require implementation of global tax rules.
• Immediate steps to be undertaking by multinationals include an impact assessment and inventory of entities in different jurisdictions to determine potential increase in effective tax rates or cash tax increase, as well as financial statement and tax return compliance.
• Establish a strategic roadmap that considers accounting, systems, policy choices, resources, controls, disclosures and reporting requirements.
• Create the proper governance structure to properly monitor and drive accountability in both current and future decisions impacting the business.

Resources:

• OCED Releases Additional Pillar Two Guidance