Please join Graphene Economics in partnership with the Gordon Institute of Business Science (GIBS) for a breakfast event on 23 August 2022, focused on global minimum tax, new taxing rights and what they will mean for South Africa.
Tickets are R270 and can be purchased through GIBS.
About the event
Since July 2021, 137 countries (accounting for more than 90% of the global economy) have signed a deal aimed at ensuring companies pay a global minimum tax rate of 15%.
The Organization for Economic Co-operation and Development (OECD), estimates the minimum tax will generate $150 billion in additional global tax revenues annually. Pillar One will apply to multinationals with global turnover above 20 billion euros and with a profit margin above 10%, while Pillar Two will apply to those with global turnover above 750 million euros.
The idea behind the new system is that it will benefit countries where a company’s products and services are sold, and not only the countries where the products or services are provided from. This is a response to the trend towards companies migrating income from intangible sources (such as digital services or intellectual property royalties) to low tax jurisdictions to avoid paying a higher tax rate in their “home” countries.
While the proposed global minimum tax, which is now expected to be implemented from 2024, seems like a good idea for countries that have lost out on revenue collections from low tax arrangements, many developing countries (including South Africa and most African countries) are likely to have to give up any potential digital services taxes for limited potential benefit.
This may explain why only 23 African countries have signed the deal to date.
This event, sponsored by Graphene Economics, specialist African transfer pricing advisory firm, explores the potential outcomes and practical implications of the global minimum tax and proposed new taxing rights for multinationals, revenue authorities and economies in Africa.