CBFL Seminar Series: The Global Minimum Taxation (GloBE) – Implementation in Asia Pacific and Europe and Impact on business taxation, wealth structures and Family Offices by Professor Dr Martin Wenz

Professor Dr Martin Wenz presented a seminar on 29 April 2024, with the Centre for Banking & Finance Law.

The seminar discussed how the tax systems of jurisdictions are currently challenged by the implementation of the Global Minimum Taxation (15%) regarding multinational enterprises, wealth structures (trusts, private foundations), and family offices to floor international tax competition. The implementation of the respective GloBE-Rules is currently the most important project in international taxation. Whilst many countries in Europe have already introduced GloBE being in force from 1st January 2024, many countries in Asia Pacific and elsewhere are still in the implementation process to apply GloBE from 1st January 2025 onwards. The seminar focuses on the tremendous impact of GloBE on the future taxation of multinational enterprise, wealth structures and family offices. Especially in jurisdictions with a territorial tax system, a competitive tax burden or preferential tax regimes (Hong Kong, Ireland, Liechtenstein, Singapore, Switzerland), tax incentives like IP-Boxes, R&Dsuper-deductions and tax exemptions are mostly cancelled-out by GloBEtop-up taxes, subject to the introduction of Qualified Refundable Tax Credits (QRTC). Conversely, high tax countries like China, France, Spain and the UK still may use tax incentives to increase their tax competitiveness and to lower their effective tax burden up to a maximum of 15%. Whereas tax competition in the past boosted crossborder Base Erosion and Profit Shifting (BEPS) and the use of tax incentives in highly competitive jurisdictions, the introduction of GloBE will support domestic BEPS measures to achieve a similar level of tax competitiveness in less competitive, but much larger and diversified countries. Thus, tax competition is everything, but ended by the introduction of GloBE, and supplemented by subsidy competition.