Understanding the Global Minimum Corporate Tax (GMCT)
The Global Minimum Corporate Tax (GMCT)is an internationally agreed-upon tax rate designed to prevent multinational corporations (MNCs) from shifting profits to low-tax jurisdictions. Spearheaded by the OECD/G20 Inclusive Framework, this tax aims to curb tax competition and ensure fair revenue distribution among nations.
In 2025, new developments are reshaping the global tax landscape, and businesses must adapt to remain compliant.
What’s Changing in 2025?
1️⃣ New Countries Implementing GMCT
As of January 1, 2025, several countries, including Malaysia, Singapore, and Thailand, will begin enforcing the 15% global minimum tax rate, aligning with OECD guidelines.
2️⃣ The U.S. Exit from the Global Tax Deal
Following Donald Trump’s re-election, the United States withdrew from the agreement via executive order. This move raises concerns over the future of international tax cooperation and enforcement.
3️⃣ Digital Taxation vs. Global Taxation
With some nations pushing for Digital Services Taxes (DSTs) in addition to GMCT, a potential trade dispute looms, particularly between Canada, the EU, and the U.S.
Global Implementation Status (2025 Update)
Country/Region
Implementation Status
Tax Rate (%)
Policy Updates (2025)
🇺🇸 United States
Withdrawn (Trump Administration)
N/A
U.S. exited OECD tax deal (Jan 2025)
🇬🇧 United Kingdom
Implemented
15%
Compliance with OECD Pillar 2
🇩🇪 Germany
Implemented
15%
No major changes in 2025
🇫🇷 France
Implemented
15%
Digital tax remains in place
🇯🇵 Japan
Implemented (April 1, 2024)
15%
Strengthened corporate tax compliance
🇨🇦 Canada
Implementing
15%
Considering additional digital services tax (DST)
🇦🇺 Australia
Implemented
15%
2025 enforcement under OECD rules
🇸🇬 Singapore
Implementing (Jan 1, 2025)
15%
Introducing Top-Up Tax for MNCs
🇲🇾 Malaysia
Implementing (Jan 1, 2025)
15%
First filings due March 2025
🇹🇭 Thailand
Implementing (Jan 1, 2025)
15%
New GMCT legislation passed
🇮🇳 India
Under Review
TBD
Evaluating compliance with OECD framework
🇧🇷 Brazil
Not Implementing
N/A
Focus on domestic tax reform instead
🇦🇪 UAE
Implemented (June 2023)
9% + 15% GMCT for MNCs
GMCT applies only to MNCs over €750M turnover
🇨🇳 China
Limited Participation
N/A
No clear commitment to GMCT
🇷🇺 Russia
Not Participating
N/A
Opposed OECD tax framework
OECD Countries (General)
Implementing
15%
GMCT fully in effect by 2025
UN Tax Framework
Under Development
TBD
Could challenge OECD’s global tax authority
Key Deadlines & Compliance Guidelines
First GMCT tax filings: March 2025
New digital tax proposals: Expected Q2 2025
OECD Review Meeting: July 2025
Actionable Tip: Companies should consult tax professionals to assess the impact of these changes on their 2025 tax strategy.
The UN Tax Convention: A New Era for Global Taxation?
The UN General Assembly’s decision to create a UN Framework Convention on International Tax Cooperation challenges the OECD’s authority over global tax matters. Developing nations are pushing for a fairer revenue distribution model, shifting tax control from the OECD to the United Nations.
How Businesses Can Prepare
✔ Conduct a Tax Impact Assessment – Identify how the new 15% tax affects your business. ✔ Review Digital Tax Risks – If operating in the EU, Canada, or Asia, anticipate new digital service tax obligations. ✔ Monitor U.S. Tax Policy Changes – The U.S. withdrawal could lead to shifts in tax regulations for American-based MNCs.
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