Global Minimum Tax: Impact on companies in MESA
For the first time, multinational groups in the Middle East will be required to comply with a GMT, despite many being headquartered or resident in nil or low rate tax jurisdictions.
This is due to the OECD’s global tax reforms (also referred to as BEPS 2.0, Pillar 2), which propose a GMT rate of 15%. On 20 December 2021, final Global Anti Base Erosion (GLoBE) rules were released by the OECD and to date, the GMT has been endorsed by 137 countries including Bahrain, KSA, Oman, Qatar and the UAE. The GMT is expected to be effective from 2023.
The impact of the GMT is expected to be significant for groups that have operations in the Middle East, from both a cash-flow and compliance perspective, and is also likely to have many domestic tax implications.
On Wednesday, 19 January, our tax experts discussed the impact of the 2021 OECD releases and what the latest and imminent developments mean for your organization, from a global and regional perspective.