In 2022, Directive 2022/2523 was adopted to ensure a global minimum tax level for multinational groups and large domestic groups within the EU. The directive is to be be implemented by individual EU Member States according to national law.
This Directive came following the OECD’s Pillar II, whereby the aim is to ensure a global minimum tax on at 15 percent. The Directive envisaged that the applicable tax would be the ‘profit calculation’, which would be applied in principle in the state where an undertaking’s highest parent unit is located. The income calculation rule would be taxation allocation based on intra-group ownership relationships. The group’s top parent company should pay supplementary tax if the actual tax level of the directly or indirectly owned group unit falls below the agreed minimum level.
The Ministry of Finance of Finland has launched a public consultation on its proposed implementation of the directive into Finnish law. It intends to have the law in place by 1 January 2024, so that the tax is applied from the 2024 tax year onwards.
Submissions are welcome before 8 September 2023 here, and will be public documents.
Graham Butler