Following months of ‘intense negotiations’, the OECD said a comprehensive package for a ‘side by side’ arrangement had been reached with the US and a further 146 countries, which means US multinationals are exempt from the Pillar Two rules.

The OECD said the agreement will ‘set the foundation for stability and certainty in the international tax system’.

However, Pillar Two will not be the global agreement the OECD had hoped for, after failing to reach agreement with the US on the plan for a global minimum 15% tax rate, putting the effectiveness of Pillar Two tax into question. From original conception, it was designed to stop profit shifting by the major global digital multinationals, which are primarily US based with the likes of Amazon, Meta and Apple exempt from the rules.