Date: 21 March 2024 – 16 May 2024

In the 2023–24 Budget, the Australian Government announced it would implement key aspects of the OECD/G20 Two‑Pillar Solution to address the tax challenges arising from digitalisation of the economy (the Two‑Pillar Solution). This includes implementing a 15 per cent global minimum tax and domestic minimum tax as part of a coordinated approach across approximately 140 Inclusive Framework member jurisdictions in line with the Two Pillar Solution.

The exposure draft materials implement these key aspects, delivering on the government’s election commitment to ensure multinationals pay their fair share of tax.

Primary legislation

As part of implementing this measure, exposure draft primary legislation, subordinate legislation in the form of Rules and accompanying explanatory materials have been drafted.

The primary legislation includes:

  • an Imposition Bill which imposes the tax payable under the global and domestic minimum taxes
  • an Assessment Bill which establishes the liability and framework for the global and domestic minimum taxes
  • a Consequential Amendments Bill which contains consequential and miscellaneous provisions necessary for the administration of the global and domestic minimum taxes.

An explanatory memorandum has been prepared covering these three Bills.

A separate discussion paper has also been included to assist stakeholders in providing feedback on interactions between the exposure draft primary legislation and provisions in Australia’s existing income tax law, including:

  • the hybrid mismatch rules
  • controlled foreign company rules
  • foreign income tax offsets.

Further information can be accessed here.

Subordinate legislation

As part of implementing this measure, exposure draft primary legislation, subordinate legislation in the form of Rules and accompanying explanatory materials have been drafted.

The subordinate legislation, in the form of Rules, comprise the key operative aspects of the Global Anti‑Base Erosion (GloBE) Model Rules (for example, computation of GloBE Income, effective tax rate calculations and so on).

An explanatory statement has been prepared for the Rules.

Further information can be accessed here.

Comments are closed.