Germany: Law implementing Pillar Two global minimum tax passed by lower house of Parliament
The law must pass the Bundesrat and be promulgated to become effective.
Passed by lower house of Parliament
The lower house of the German Parliament (Bundestag) on 10 November 2023 passed the law to implement Council Directive (EU) 2022/2523 to ensure global minimum taxation (Pillar Two) and other accompanying measures as recommended in the resolution (BT-Drs. 20/9190 (new)).
Amendments to the German Commercial Code (HGB) and Introductory Act to the German Commercial Code (EGHGB) are also planned.
- In line with international accounting standards, the amendments to the HGB initially concern a mandatory exemption from recognizing deferred taxes resulting from the application of the minimum tax act or corresponding foreign minimum tax laws.
- In addition, mandatory disclosures are provided for in the notes to the financial statements and the notes to the consolidated financial statements to ensure a minimum level of transparency and information for users of the financial statements.
- The disclosures relate to the actual tax expense or tax income resulting from the minimum tax act or corresponding foreign minimum tax laws, as well as explanations of the expected effects from the application of such minimum tax laws that have not yet become effective.
- The disclosures in the notes must be made for the first time in annual and consolidated financial statements whose financial year ends after 30 December 2023 and therefore affect all companies with a financial year with the same calendar date.
The law must pass the upper house of the German parliament (Bundesrat) and be promulgated to become effective.
Read a November 2023 report prepared by the KPMG member firm in Germany
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