Global Tax Agreement Amended: Multinationals to Face Fairer Rules

Over 145 countries have agreed to modify the 2021 global minimum corporate tax agreement to address U.S. concerns. The amended framework maintains a 15% tax to ensure fair taxation of large multinationals. The update addresses earlier objections by aligning U.S. tax laws with global standards and protecting tax bases.

More than 145 nations have reached a consensus on amending the 2021 global minimum corporate tax agreement, with the primary goal of addressing U.S. concerns that existing rules could adversely affect its multinational corporations. The Organisation for Economic Cooperation and Development (OECD) announced that the updated framework still enforces a 15% global minimum tax, ensuring that large multinational companies contribute a baseline tax wherever they operate.

The recent amendments include simplifications and carve-outs, designed to align U.S. tax laws with international standards. These changes come in response to earlier objections by the Trump administration. According to OECD head Mathias Cormann, this revised arrangement enhances tax certainty, reduces complexity, and safeguards tax bases worldwide.

As of October, over 65 countries were actively implementing the 2021 global tax deal, which mandates a 15% corporate tax or an additional levy on multinationals booking profits in lower-tax jurisdictions. The revamped agreement reinforces global support, particularly after the G7, including the U.S., brokered a deal in June to exempt some U.S. companies from specific parts of the original framework. The broader agreement reached on Monday aims to stabilize the global tax deal following challenges posed by the Trump administration.

(With inputs from agencies.)