The Inclusive Framework of the OECD with 139 member countries published benchmarks on the future taxation of large, internationally active companies on 1 July 2021:

  • Pillar 1 - Shifting taxation rights to market states: Companies with an annual turnover of more than 20 billion euros and a profit margin of more than 10 per cent must pay tax on part of their profits in the market area. This only affects a few large Swiss companies.
  • Pillar 2 - minimum tax rate of 15 per cent: internationally active companies with an annual turnover of more than 750 million euros are to be subject to a global minimum tax. This turnover threshold is exceeded by around 200 Swiss companies as well as various Swiss subsidiaries of foreign groups.

Switzerland joins them, but maintains its reservations and conditions.

Despite major concerns, countries such as Switzerland have signed up to the benchmarks. A multilateral agreement is intended to prevent a confusion of national solutions, create legal certainty and prevent the announced unilateral moves by large states.

Switzerland explicitly demanded that the interests of small, innovative countries be adequately taken into account in the final design of the rules and that national legislative procedures be respected in the implementation. Furthermore, the new rules should be applied uniformly by the member countries and a balanced solution should be found between the tax rate and the assessment base in the case of minimum taxation.

The OECD is to work out the details of the two pillars by the end of 2021; implementation is planned for 2023The entire FDF media release is available here; the OECD counterpart in English is available in the OECD Newsroom here.