G7 leaders endorse direction of OECD consensus project on digital taxation

G7 Finance Ministers support OECD two-pillar project to develop new rules for taxing multinational businesses

Executive summary (July 18, 2019).

The Chair’s Summary includes a section on international taxation, which focuses on the OECD)/G20Inclusive Framework project to address the tax challenges of the digitalization of the economy through revisions to existing profit allocation and nexus rules (Pillar 1) and development of new global minimum tax rules (Pillar 2).

The Chair’s Summary indicates that the G7 Finance Ministers agreed that addressing these challenges is urgent and supported a two-pillar solution to be developed through the OECD workplan. The Chair’s Summary reflects G7 agreement to move forward with both pillars.

It also reflects G7 discussions aimed at bridging the gap between alternative proposals for new profit allocation and nexus rules that have been advanced by the United States (US) on the one hand, and the United Kingdom (UK), France and other European countries on the other hand, in order to focus the work on one proposed approach.

Source Deloitte EY