Common Contracts
1 similar Update Agreement contracts
ContractUpdate Agreement • October 11th, 2021
UPDATE AGREEMENT ON GLOBAL MINIMUM TAX RATE 11 October 2020 Traditionally, the taxation of business profits has been linked to a physical presence- based nexus rule. While this was sufficient in the brick-and-mortar economy, the rapid digitalisation of the economy (with growth of digital platforms like Facebook, Amazon, Netflix, Google etc) meant that the existing tax rules were not sufficient in relation to taxation of digital economy. Businesses no longer need physical presence to derive economic benefits from a jurisdiction. This raised concerns for ‘market jurisdictions’ having the customer / user base, which, in the absence of a taxing right, were not getting their fair share of tax revenues on the income earned by offshore businesses from their territory. While this issue was first identified around two decades ago and being deliberated on since then, efforts and concrete steps in this direction have picked pace in the past few years. 136 countries (out of the 140 members of
