BDO Global Corporate Tax News

Lots of Pillar Two news to report! New legislation enacting a global minimum tax applies in Australia, Hong Kong, Indonesia, Kuwait, Oman, Thailand and the UAE, and Japan has announced that it intends to add a UTPR and QDMTT to the existing IIR. The first deadline for in-scope MNE groups to submit a notification as the group head in Germany is due by 28 February. Meanwhile, as countries continue to implement Pillar Two rules, the US has announced that the global minimum tax initiative “has no force or effect” in the country, effectively withdrawing the US from any participation in the project. The OECD has released a compilation of qualified domestic rules and other tools to rationalize the coordinated administration of the minimum tax, including an update to the GIR. Read up on these developments and don’t forget the Pillar Two implementation summary included in this issue.

An interesting announcement in India’s Budget 2025 is that a new simplified tax code is on the horizon. 

We also report on several developments in the EU:

• The FASTER Directive has been adopted with the rules to apply as from 1 January 2030.
• Denmark has enacted a package of measures to strengthen the country’s competitive edge and provide a favorable environment for innovation and business growth, including a tax exemption for dividends from unlisted portfolio shares. 
• Final guidance has been issued in Germany on the domestic anti-hybrid rules. 
• In a welcome move, Greece has expanded the scope of the participation exemption for intragroup dividends and capital gains from share transfers to apply to dividends and capital gains derived from subsidiaries based outside the EU.
• Italy has eliminated a revenue threshold for entities to fall within the scope of the digital services tax and introduced an advance payment obligation.
• The CJEU has ruled that Spain’s dividend withholding tax rules are incompatible with the free movement of capital principle in the EU treaty.

Learn about these developments and more in Corporate Tax News and be sure to check out the corporate and withholding tax rate changes for 2025.

• AUSTRALIA: The Pillar 2 Global and Domestic Minimum Tax Regime is now law in Australia
• DENMARK: New Tax Legislation Introduced for Growth and Innovation
• GERMANY: 
  • Final Guidance on Anti-Hybrid Rules Released
  • Impending Deadline to Submit Notification as Head of a Tax Group for Pillar Two Purposes
• GREECE: Participation Exemption Extended to Non-EU Companies
• EQUADOR: Guidance on Tax Havens and Preferential Tax Regimes Updated
• EGYPT: MOF Unveils Package of Broad-Based Tax Facilities
• EUROPEAN UNION: 
  • FASTER Directive for Simplifying Withholding Tax Procedures Adopted
  • Potential for Loss-Making Nonresident Entities to Recover Withholding Tax
• HONG KONG: The Hong Kong Government released the bill to implement the GloBe Rules
• INDIA: Decoding the Union Budget 2025
• INDONESIA: Global Minimum Tax Under Pillar Two Implemented
• INTERNATIONAL: 
  • Corporate Tax Bytes
  • Pillar Two implementation updates
  • Corporate and Withholding Tax Changes for 2025
  • Scope of Digital Services Tax Broadened and Advance Payment Requirement Introduced
• JAPAN: 2025 Tax Reform Proposal Includes Pillar Two UTPR and QDMTT
• KUWAIT: Pillar Two Domestic Top-Up Tax Enacted
• OMAN: Pillar Two Legislation in Effect
• SINGAPORE: Importance of Maintaining Corporate Tax Residency Status
• THAILAND: Thailand Implements a Global Minimum Tax/Top-Up Tax
• UNITED STATES: U.S. Withdraws From Global Tax Agreement