MHA | 138 Countries and Jurisdictions Reach Historic Landmark…

138 Countries and Jurisdictions Reach Historic Landmark Agreement on International Tax Reform

Chris Danes · July 17th 2023 · read

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On 11 July 2023, 138 members of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS), representing over 90% of global GDP, agreed upon an Outcome Statement. This statement recognises the significant progress made and paves the way for major reforms in the international tax system. The reforms, known as the Two-Pillar Solution, aim to achieve a fairer distribution of profits and taxing rights among countries and jurisdictions, with a specific focus on the world's largest Multinational Enterprises (MNEs). The Outcome Statement reflects the collaborative efforts and compromises made by jurisdictions of all sizes, including both developing and developed nations, during 20 months of intense technical negotiations.

The Outcome Statement, which emerged from the 15th Meeting of the Inclusive Framework (IF), is the culmination of 20 months of intense technical negotiations by delegates. It reflects a spirit of collaboration and compromise among jurisdictions of all sizes, encompassing both developing and developed nations. These negotiations have been ongoing since October 2021 and have laid the groundwork for substantial reforms in the international tax landscape.

The Outcome Statement highlights the deliverables developed by the IF to address the remaining elements of the Two-Pillar Solution, including a Multilateral Convention (MLC), a simplified framework for the arm's length principle, the Subject-to-Tax Rule (STTR), and a comprehensive action plan for coordinated implementation.

Next Steps Towards Completion of the Two-Pillar Solution:

  • Outcome Statement to G20: Outcome Statement presented to G20 in upcoming meeting scheduled from 17-18 July 2023.
  • MLC Signature: Multilateral Convention (MLC) to be signed by year-end, taking effect in 2025.
  • Pillar One Work Completion: Finalisation of Pillar One's Amount B by January 2024, considering low-capacity jurisdictions and MLC interdependence.
  • STTR Publication and Signature: STTR documentation published next week, open for signature from 2 October 2023.
  • Comprehensive Action Plan: OECD developing action plan to assist implementation, including support for developing countries.

For detailed information on the agreement and its components, please refer to the official press release by the OECD available at:

Chris Danes (Tax Partner, MHA, Global Tax Solutions) concludes “Momentum is building regarding Pillar 2 and the complex and nuanced rules are becoming clearer, with the UK legislation passing recently too. Interesting to see that Pillar 1 Amount B is being driven forward as well, given this will be a significant change to the Transfer Pricing regimes across the globe.”

Find out more about BEPS 2.0

For more information on the BEPS tax framework or other corporate international tax matters, please Contact Us, or email Chris Denning or Chris Danes from our International Tax team, who will be happy to assist:

Chris Denning, Head of Corporate International Tax: [email protected]
Chris Danes, Tax Partner: [email protected]

The content in this article is in collaboration with the IBFD organisation. No part of this information may be reproduced or distributed without permission of IBFD. Disclaimer: IBFD will not be liable for any damages arising from the use of this information.

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