Bermuda: Implementation of corporate income tax within scope of Pillar Two global minimum tax rules
The government of Bermuda will conduct further analysis to determine the appropriate corporate income tax rate.
Implementation of corporate income tax within scope of Pillar Two global minimum tax rules
The government of Bermuda on 8 August 2023, announced that it is considering the implementation of a new corporate tax regime within scope of the base erosion and profit shifting (BEPS) Pillar Two global minimum tax rules.
According to the public consultation [PDF 1 MB], the proposed corporate income tax would:
- Qualify as a covered tax for purposes of the global anti-base erosion (GloBE) rules, such that the Bermuda corporate income tax would mitigate the amount of top-up tax payable to other jurisdictions with respect to profits earned
- Leverage certain key scoping and definitional elements of the GloBE rules, both to expedite the development of the corporate income tax rules and support consistent, predictable global tax outcomes on profits earned
- Include design features intended to support key policy initiatives of the government of Bermuda (e.g., maintaining the competitiveness and reputation for quality of Bermuda, reduction in cost of living and doing business, job creation, increasing the residential population, and other initiatives intended to stimulate the economy)
- Be effective for tax years beginning on or after 1 January 2025
The government of Bermuda will conduct further analysis to determine the appropriate corporate income tax rate, but currently believes a rate within a range of 9% to 15% may be appropriate to address the policy considerations previously noted.
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