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7 February 2024

Global minimum tax

A worldwide reform to promote fair taxation and fair competition

For years now, the German government has been a leading advocate for international corporate tax reform. Major international corporations that do business and make profits in Germany should pay taxes here just like local small and medium-sized businesses do. For this reason, the introduction of a global minimum corporate tax rate is a matter of fair taxation. A global minimum tax will also facilitate fair competition and strengthen Germany’s position as a magnet for business.

The reform of the international corporate tax system encompasses two key components, which are frequently referred to as the “two-pillar solution”. Pillar 1 involves the reallocation of rights to collect tax from the world’s largest and most profitable corporations. Pillar 2 involves the introduction of a global minimum effective tax rate of 15% which aims, among other things, to put an end to aggressive tax planning and harmful tax competition. The international agreements that were reached for this purpose represent a historic milestone in international tax law and provide a blueprint for successful global cooperation.

Background information on the minimum tax and further details on the two-pillar solution can be found here:

Content-related sites

Making progress towards fair international taxation

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Global minimum tax: frequently asked questions

More : Global minimum tax: frequently asked questions

Global minimum tax: key documents

The following documents provide an overview of key legislation relating to the global minimum tax, as well as useful background analysis.

Please note that this is not an exhaustive list. These working translations are provided as a courtesy by the Federal Ministry of Finance’s Language Service and are merely for informational purposes. Only the German-language versions are authoritative for the application of the law. Please note that the translations have not been coordinated with other government bodies in Germany.


The BEPS project

The reform efforts to ensure a fairer system of international taxation were driven largely by the “Inclusive Framework on BEPS”. BEPS stands for “base erosion and profit shifting”, and the Inclusive Framework – which was set up by the OECD and the G20 – developed the two-pillar solution that aims to overhaul the international corporate tax system. The Inclusive Framework is responsible for monitoring national implementation of the two pillars and for advancing international cooperation. Over 140 jurisdictions work together on an equal footing within the Framework, which forms a key part of the BEPS project.

The BEPS project was launched in 2013 by the G20 and the OECD, with the aim of curbing harmful tax competition between tax jurisdictions and combating aggressive tax planning by multinational corporations. The German government has actively supported the BEPS project from the start.