Why 15%? Justifying the Global Corporate Minimum Tax

3 Pages Posted: 27 Mar 2023

Date Written: March 18, 2023


The global corporate minimum tax (GLoBE) as embodied in Pillar 2 of the OECD/IF BEPS 2.0 proposal was set in October 2021 at 15% of the financial statement income of within scope MNEs. That is also the rate and the base of the new US corporate alternative minimum tax (CAMT). The Single Tax Principle (STP) on which Pillar 2 is built suggests that the rate should be the average OECD corporate tax rate (about 23%). So, is the 15% rate only a concession to political reality? No, because it represents a justifiable compromise between the three goals of the corporate tax.

Keywords: OECD, Pillar 2, GLoBE, CAMT

JEL Classification: H26

Suggested Citation

Avi-Yonah, Reuven S., Why 15%? Justifying the Global Corporate Minimum Tax (March 18, 2023). Available at SSRN: https://ssrn.com/abstract=4392468 or http://dx.doi.org/10.2139/ssrn.4392468

Reuven S. Avi-Yonah (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4033 (Phone)

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