From 1st January 2024 ground-breaking new EU rules come into effect introducing a minimum rate of effective taxation of 15% for multinational companies active in EU Member States.
The framework will bring greater fairness and stability to the tax landscape in the EU and globally, while making it more modern and better adapted to today's globalised, digital world.
The rules will apply to multinational enterprise groups and large-scale domestic groups in the EU, with combined financial revenues of more than €750 million a year. They will apply to any large group, both domestic and international, with a parent company or a subsidiary situated in an EU Member State.
The Directive includes a common set of rules on how to calculate and apply a 'top-up tax' due in a particular country should the effective tax rate be below 15%. If a subsidiary company is not subject to the minimum effective rate in a foreign country where it is located, the Member State of the parent company will also apply a top-up tax on the latter. In addition, the Directive ensures effective taxation in situations where the parent company is situated outside the EU in a low-tax country which does not apply equivalent rules.