BDO Corporate Tax News - Issue 73

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.