The OECD has just announced (on 1 July 2021) that it has reached a consensus amongst 130 jurisdictions for a plan to adopt a 15% global minimum tax rate (known as Pillar Two) and to change the allocation of tax revenues for multinational groups with a global turnover above €10bn (known as Pillar One).

This puts some flesh on the bones of a deal that has looked increasingly likely in the months since the Biden administration's intervention, in April 2021, in the debate about global taxation of multinationals - as we reported previously.

The OECD announcement is consistent with the recent G7 deal, and in fact goes further in setting out how these rules might work and which global businesses are most likely to be affected.

There remain some significant unanswered questions. Are financial services within scope? How does the minimum rate apply to sources of income that are widely exempted from tax on receipt (such as dividends from subsidiaries)? These points are likely to be hotly contested as the final, detailed proposals are thrashed out over the summer for resolution in the autumn.