Pillar 2, also known as the Global Anti-Base Erosion (GloBE) proposal, is a significant development in international tax reform. The new framework aims to level the tax playing field by discouraging countries from reducing their corporate income tax to attract foreign business investment. Essentially, it introduces a global minimum tax rate (15%) to encourage multinational enterprises to pay their fair share of taxes. Pillar 2 aims to drive these tax outcomes by impacting the financial accounting policies and processes in place at these companies.
Naturally, Pillar 2 introduces significant complexity and uncertainty into the economic environment. This is poised to disrupt business operations extensively. The new rules are expected to materially influence corporate strategies, especially in areas such as restructuring, M&A, site selection, and other key operational and investment decisions.
As countries around the world work toward implementing Pillar 2, it is crucial that businesses understand its implications and adapt their strategies accordingly.
In this publication, we specifically look at the implementation of Pillar 2 within Central European jurisdictions:
We hope you find this overview insightful and valuable to your work going forward.
Implementation of Pillar Two across the Central European region
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