Organisation For Economic Co-operation And Development (OECD) And G20:
India has joined the Organisation for Economic Co-operation and Development (OECD) and G20 Inclusive Framework tax deal of global corporate tax.
- Majority of the members OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting(including India)adopted a high-level statement containing an outline of a consensus solution to address the tax challenges arising from the digitalisation of the economy.
- The proposed solution consists of two components –
- Pillar One which is about reallocation of additional share of profit to the market jurisdictions and
- Pillar Two consisting of minimum tax and subject to tax rules.
- Further, the technical details of the proposal will be worked out in the coming months and a consensus agreement is expected by October.
- Base Erosion and Profit Shifting (BEPS) refers to tax-avoiding strategies used by big multinational companies that exploit the gaps and mismatches in tax rules across the globe.