Global tax reform: thin end of the wedge for multinational SMEs?

As G20 leaders approve the final agreement on a corporate base tax rate, Jelle R Bakker, director-global tax group Europe at Kreston Global, considers whether SMEs operating cross border will be caught by the rules

On 8 October 2021, 136 out of 140 members of the OECD/G20 Inclusive Framework officially agreed an international agreement to reallocate some taxing rights to market jurisdictions (Pillar One) and introduce a global minimum effective taxation (Pillar Two). Technical details will be released over the next 14 months, starting with Pillar Two rules in November 2021, while Pillar One rules will be detailed over 2022. The new rules will be gradually introduced from 2023.

In this article, I will reflect on how these new rules might affect small and medium-sized businesses (SMEs) with a global annual turnover in the range of €50m (£42.5m) to €100m.

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