In July, a total of 130 countries agreed to change global tax norms to ensure that multinationals pay taxes at a minimum rate of 15% wherever they operate.
Finance Minister Nirmala Sitharaman on Wednesday said India is “very close” to arriving at the specifics of a two-pillar taxation proposal in the G20 and is in the final stages of finalizing the details.
A total of 130 countries did in July agreed to an overhaul of global tax norms To ensure that MNCs pay taxes wherever they operate and at a minimum rate of 15%. The finance ministry had then said that some important issues, including share in profit allocation and the scope of tax rules, were yet to be addressed and a “consensus agreement” was expected by October after working out the technical details of the proposal.
The proposed two-column solution comprises two components – column one which is about reallocation of additional share of profit in market jurisdiction and column two subject to minimum tax and tax rules.
Speaking at ICRIER’s annual international G20 conference, Ms Sitharaman said the two-pillar solution to the international taxation issue will reach an advanced implementation stage, which India will have to pilot.
“At this stage, we are very close to arriving at something in terms of the specifics of the two-pillar proposal. We had already negotiated and agreed a framework… We are in the final stages of finalizing the details. So I don’t think it’s an appropriate time for me to give details of what we are agreeing on, but these are things that are under discussion,” Ms Sitharaman said.
The finance ministers of the G20 countries are scheduled to meet in Washington on 13 October.
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