Latest news with #BEPS
The Hindu
07-07-2025
- Business
- The Hindu
OECD Tax Framework Collapses as G7 Bows to Trump's reciprocal tax threat
Published : Jul 07, 2025 16:03 IST - 6 MINS READ Developments that have occurred in quick succession have crushed the successful efforts made in recent years to increase global cooperation aimed at raising tax revenues to take on a host of global challenges. Late in June, the non-US six (Canada, France, Germany, Italy, Japan, and the UK) in the G7 announced that they had agreed to a 'side-by-side solution' that amounts to a retreat from the existing global agreement to cooperate on corporate taxation. They have decided to exempt US multinationals from being subject to a minimum tax on their profits of 15 per cent, as required under an agreement sealed in 2021. To recall, after years of negotiation, an agreement titled the 'OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS)' was arrived at in 2021 under the auspices of the Organisation for Economic Co-operation and Development (OECD), with non-OECD countries too joining the discussion. That agreement was a commitment on the part of over 140 governments to work towards implementing a common framework to tax the global profits of transnational companies that find ways to transfer to and record their profits in low tax locations where they often have little economic activity. The BEPS framework was a means to combat such tax avoidance practices that reduce national and aggregate global tax revenues, and help governments tax profits in jurisdictions where economic activity actually occurs and value creation takes place. Also Read | A summit of subordinates The core of the agreement, which recommended 15 actions, was named Pillar Two of the framework. This was by no means far-reaching. It merely set a 15 per cent floor rate of tax on the profits of multinationals in all the cooperating jurisdictions, which was much lower than the 25-30 per cent considered reasonable by those looking to raise resources for meeting various financing challenges. Dissatisfaction over this and the tardy move to implement the OECD agreement set off demands for a global tax convention under the auspices of the UN, which would give less developed countries more of a say in determining the terms of the agreement and a greater role in its implementation. Some progress has been achieved on this, with a UN General Assembly decision to constitute an ad hoc committee to draft the terms of reference for a UN Framework Convention on International Tax Cooperation. Negotiations on the convention were to occur over 2025 to 2027. Weaponised tariffs However, from the very start the US—though a party to the OECD agreement—has been expressing reservations about a number of the proposed measures, especially the Pillar Two global minimum tax. With US multinationals being the principal adopters of profit-shifting strategies, they would have been the main targets of any such minimum tax, however low. So, the US, while committed to the inclusive framework, campaigned during Donald Trump's first term as President of the US, for a much-diluted version of the minimum tax proposal. And, in Trump's more aggressive second term, in which he has chosen to weaponise tariffs and taxes, Pillar Two seems to be under attack. Going on the offensive, the original version of Trump's so-called 'big beautiful' budget Bill included a section—Section 899—that authorised the US government to impose 'revenge taxes' on foreign investments emanating from countries that 'discriminated' against US firms in their tax practices. Support for a minimum corporate tax on global profits in locations were they were actually earned was seen as an instance of such discrimination. In the face of that threat, the non-US members of the G7 caved in and agreed to a side-by-side solution that exempts US multinationals from the global minimum tax provision, which amounts to dumping Pillar Two and with it the OECD agreement. That would also undermine efforts to institute an effective UN convention on international taxation, since leading countries are now likely to opt out of the convention. The link between the decision on the minimum tax and the proposed revenge taxes was clearly revealed when the US Treasury Department asked the US Congress to drop Section 899 because, in Treasury Secretary Scott Bessent's words, the US had secured concessions exempting US companies from the OECD's global minimum tax regime. In fact, the Trump administration seems set to destroy all efforts at combating tax avoidance by threatening action against any international taxation measures that target multinational profits. Days after the 'side-by-side solution' was announced by non-US G7 members, Canada declared that it was scrapping a proposed tax on digital services companies that was to come into effect on June 30. The tax involved was a paltry levy of 3 per cent, which was to apply on revenues earned by firms like Meta, Netflix, and Amazon from cross-border provision of services to Canadian clients. But even that small levy was expected to increase Canada's federal government revenues by $5.3 billion over five years. Trump declared the tax a 'direct and blatant' attack on US firms, and suspended negotiations on a deal on reciprocal and special tariffs. Fearing that the tax would upend discussions on that deal, Canadian Prime Minister Mike Carney said that his government had decided to scrap the levy in order to facilitate resumption of trade talks. Global repercussions This too is likely to be a precedent with global repercussions. Many countries, especially in the EU like France have digital services taxes in place. Germany has been considering imposing a 10 per cent tax on global digital platforms like Meta and Google. And the European Commission has been talking of imposing a tax on the advertising revenues of tech firms. All of these are now under threat, as revoking them may be made a precondition for any deal on tariffs, even though there are signs that a baseline 10 per cent reciprocal tariff on imports into the US will remain and only special tariffs above these are up for negotiation. Also Read | Trade is very central to Trump's world view: Navtej Sarna One of Trump's slogans is that he wants to 'Make America Great Again' by bringing back manufacturing that had moved abroad, not least by relying on import tariffs. That could affect the profits of US firms if they are forced to withdraw from low-cost production locations abroad. Simultaneously, he seems intent on fighting discrimination against US multinationals to protect the profits of US firms. The possibility that the two objectives might be in contradiction seems lost on the President. C.P. Chandrasekhar taught for more than three decades at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. He is currently Senior Research Fellow at the Political Economy Research Institute, University of Massachusetts Amherst, US.
Time of India
07-07-2025
- Business
- Time of India
Top 10 high-paying career options after becoming a Chartered Accountant
Clearing the Chartered Accountancy (CA) final exam marks the beginning of a diverse range of professional opportunities. While many associate the CA qualification primarily with auditing or taxation, the modern landscape in 2025 reflects a broader spectrum of career paths, many of which offer not just financial rewards but also cross-border exposure, leadership growth and sectoral influence. Here's a look at 10 high-paying career options available to Chartered Accountants after completing the course and registering with ICAI. Management consulting Chartered Accountants are increasingly sought after by global consulting firms for roles in financial strategy, risk advisory and performance improvement. Their grounding in numbers, compliance and business logic allows them to support high-stakes decision-making for large enterprises. Firms like McKinsey, BCG, Bain and Deloitte recruit CAs who can work across sectors and geographies, making this path both financially and intellectually rewarding. Investment banking CAs with strong financial modelling skills and an understanding of deal structures are well-positioned to enter investment banking. These roles involve raising capital, managing mergers and acquisitions and analysing equity performance for institutional clients. Many CAs transition into i-banking after experience in Big Four advisory teams or corporate finance divisions, often working alongside MBAs and CFAs in high-pressure environments. Chief Financial Officer (CFO) track Many Chartered Accountants gradually move into senior leadership roles, often rising through the finance function to become Chief Financial Officers. The journey typically begins with operational roles in accounting, financial planning and treasury, but later expands into board-level responsibilities such as investor relations, capital allocation and business strategy. This path demands both technical depth and cross-functional leadership. Forensic auditing and risk advisory With tightening regulations and an uptick in financial irregularities, forensic accounting has gained ground as a specialised vertical. Chartered Accountants trained in forensic audits are involved in fraud detection, dispute resolution, regulatory compliance and litigation support. Such roles often involve close coordination with legal teams, internal auditors and enforcement bodies, requiring discretion and investigative skill. International taxation and transfer pricing In an increasingly globalised economy, multinational firms require experts to manage complex international tax structures. CAs working in this space advise on transfer pricing documentation, OECD guidelines and Base Erosion and Profit Shifting (BEPS) compliance. The work is research-intensive, often involving liaison with global teams and demands continuous learning as global tax laws evolve. Private equity and venture capital Private equity and venture capital firms look for professionals who understand business valuation, deal execution and post-investment portfolio management. CAs with experience in transaction advisory, due diligence, or investment banking often make the switch. While entry is competitive, the exposure to strategic thinking, business building and investor networks makes this one of the most aspirational paths for finance professionals. Strategic finance roles in startups Startups increasingly hire Chartered Accountants to lead finance functions that go beyond bookkeeping. From business model forecasting to investor pitches, CAs play a central role in aligning financial discipline with growth ambitions. These roles suit professionals comfortable with ambiguity and rapid execution, and often come with performance-linked incentives or Employee Stock Ownership Plans (ESOP). Independent practice (CA firm owner) Setting up an independent practice gives Chartered Accountants autonomy and long-term income potential. Many professionals choose to specialise in high-demand niches such as indirect taxation, forensic accounting, international tax, or valuation services. As business regulations grow more complex, well-positioned CA firms with domain expertise continue to thrive. Finance leadership roles in global firms MNCs hiring Indian Chartered Accountants for finance leadership positions seek professionals with robust internal control systems, proficiency in International Financial Reporting Standards (IFRS) and a deep understanding of both Indian and international business environments. These roles often include managing regional profit and loss (P&L) accounts, overseeing cross-border operations and collaborating with stakeholders across different time zones. Prior experience with Enterprise Resource Planning (ERP) systems such as SAP or Oracle, along with strong business partnering skills, is frequently a prerequisite. Academia and thought leadership Chartered Accountants with a flair for teaching, writing or policy can carve a niche in academia and research. Business schools, think tanks and edtech platforms increasingly seek experienced professionals who can translate real-world insights into actionable learning. With growing interest in financial literacy and policy reform, this path offers intellectual fulfilment and public impact. The career landscape for Chartered Accountants in 2025 is more dynamic than ever. Whether you prefer corporate leadership, international exposure, or entrepreneurial independence, the CA qualification provides a strong foundation. As industries continue to evolve, professionals who combine technical excellence with strategic thinking will find themselves best positioned for growth. Ready to navigate global policies? Secure your overseas future. Get expert guidance now!
Mint
29-06-2025
- Business
- Mint
G7 back new side-by-side tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a "side-by-side" solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could "provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. "Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework," the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is "acceptable and implementable to all." Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States.
Mint
29-06-2025
- Business
- Mint
G7 back new side-by-side tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a "side-by-side" solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could "provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. "Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework," the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is "acceptable and implementable to all." Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States. He also threatened to impose a retaliatory tax on nations implementing the global tax rules against US firms, a move viewed as harmful to many foreign companies operating within the US. (ANI)
India Gazette
29-06-2025
- Business
- India Gazette
G7 back new 'side-by-side' tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a 'side-by-side' solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could 'provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. 'Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework,' the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is 'acceptable and implementable to all.' Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States. He also threatened to impose a retaliatory tax on nations implementing the global tax rules against US firms, a move viewed as harmful to many foreign companies operating within the US. (ANI)
