Author(s): Sankalp Mirani
The UN tax guidelines and the OECD two-pillar regime are two different approaches to overhauling the global corporate taxation system in response to the challenges posed by the digitization of the economy. The UN tax recommendations aim to provide poor countries more taxing powers in areas where the market for digital services is concentrated. They are based on the currently in force UN Model Double Taxation Convention. The two components of the OECD two-pillar regime are Pillar One, which allocates a portion of large multinational enterprises' (MNEs') residual profits to market jurisdictions using a revenuebased allocation key, and Pillar Two, which imposes a global minimum tax on MNE income to prevent profit shifting and base erosion. The authors analyse, how both the regimes fits in the global set-up and the challenges and intricacies both holds.