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OECD / G20 announced International Tax Reform

On July 11, 2023 138 members of the OECD / G20 agreed on final statement describing the process made on the issue of International Tax system reform.

This is so called two-component reform (Pillar 1 and Pillar 2) to address issues of global economy digitalization.

To briefly recall the easence of these two components:

  • a fundamentally new approach to distribution if rights for income taxation between jurisdictions in the globa digital economy (Pillar 1)

  • Guaranteed minimum tax payment by international companies with global presence (Pillar 2).

The final statement summarizes the results of the work dome and the achievements comprises that include:

  • Draft Multilateral Convention (MLC) under the first component of the tax reform (Pillar 1, amount A) - taxation of "surplus income" of the largest multinataional groups in the countries where consumers are located

  • an approach to simplifying transfer pricing rules for distributors, performing minimal economic functions and bearing minimal risks (Pillar 2, amount B)

  • Rules allowing developing countries to make changes to bilateral tax treaties tor the purpose of certain intra-group payments taxed at source at the rate of at least 9% if in the country of income recipient such payments are not are not taxed (so called Subject to tax rule, STTR)

  • A roadmap to be prepared by the OECD for rapid implementation of the tax reform.

The member countries confirmed that they will not impose taxes on digital services / similar services untill 2024 end, or till MLC adaption, whichever happens earlier.

The MLC is expected to be submitted for signature among member countries during H2 2023.

For more details please refer to

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Federal Tax Service held a conference earlier in May to increase SMEs awareness on the corporate income tax matters. You can find video recording of the event here:


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