Hello everyone. Welcome to this PWC Taxbyte podcast. My name is Peter Dere, a director in the global tax team,

and I'm very pleased that I'm having here today two experts with me on global minimum taxation.

The reason we are recording this podcast is of course the publication by the OECD of a 70-page

document outlining the proposal for a global minimum tax. Larger multinational companies

will have to pay at least 15% in every territory where they are active. That would be the one

sentence summary, I would guess, of this document.

But we will explore in much more detail with Jorgen Brotard's, and Jorgen is globally leading or compliant services network, and Jean-Philippe Vois, who is a senior council in our team,

and monitoring all the European developments very closely. So, publication of such a document right before Christmas, yeah, I have to start with this

question, Joe, Philipp.

Did you expect that the document was going to come out as an early Christmas gift or was there

a bigger chance that it would have been postponed into the new year?

I would say, Peter, finally the model rules have been published. We have been waiting for them since the 30th of November when they were initially announced,

but now three weeks later, they are finally there.

And the publication of the model rules is an important development and brings us a big step closer to the introduction of this so-called worldwide minimum tax.

And the next step is that countries will have to adopt these rules.

And as we know, within the European Union, the European Commission will present a directive to implement these model rules in the EU.

And if introduced, pillar two can be regarded as a real revolution in the international tax landscape.

Because within the BEPS 1.0 projects resulting in amongst others the adoption in the

principal purposes in tax treaties they said low taxation as such is not a real issue as long as

you have economic substance and genuine business activities but this will change with the introduction of a minimum tax according to which the mere fact that you have a low effective tax rate in a certain jurisdiction

will lead to additional taxes to be paid with respect to profits of that low tax are obtained in that low tax jurisdiction.

So this here I see a clear deviation from the previous work done within the Pabbs framework.

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