The long-negotiated 15% minimum corporate tax rate for multinational corporations came into force on January 1, 2024 throughout the European Union. The EU becomes the first major region to make this regulation mandatory. 

The minimum corporate tax is the so-called “second pillar” of the OECD global agreement negotiated in recent years to adapt to the new global reality, where many companies do not necessarily have a physical presence in the countries in which they operate and achieve large profits. In particular, the new directive aims to guarantee effective taxation in situations where the parent company is located outside the EU in a country with low levels of taxation that does not apply equivalent rules. According to OECD calculations, this will force the world’s 100 largest multinationals to pay tax on a portion of their profits in the countries where they operate, even if they do not have a physical presence there. The signatories of the OECD agreement represent more than 90% of the world’s GDP, according to the Paris-based body.

Here’s a summary of what you need to know:

  • Applies to Large & Multinational Companies. The minimum corporate tax will apply to multinational groups of companies and large national groups in the EU with combined financial revenues of more than €750 million per year. The new rules apply to any such group, that has a parent company or a subsidiary in an EU member state.
  • Common Rulebook on Tax Calculation. EU directive 2022/2523 contains a common set of rules on how to calculate and collect an appropriate this “supplementary” tax in a particular country if the effective tax rate in that country is less than 15%.
  • Supplementary Tax. If a subsidiary is not subject to the minimum effective rate in a foreign country in which it is located, the EU member state of the parent company must apply a “supplementary” tax to the parent company.
  • First Returns. Companies with a presence in the EU affected by the new Directive must file the first global minimum tax return (in general) before June 30, 2026.


  • The affected groups of companies may have to bear more taxation for their operations in countries with (i) nominal corporate income tax rates below 15% or (ii) corporate income tax that provides tax incentives which reduce their effective rates to below such threshold.
  • Calculations for the new tax can be very complex and will require affected taxpayers to spend significant time and money to identify application of the tax to their operations as well as the completion and analysis of relevant supporting data.
  • Another challenge will be the way in which the new rules are drafted and transposed within the legal framework of the different member countries. The Directive takes a very complex, technical approach triggering concerns on the transposition of the legislation onto the existing legal framework of member states. For example, a significant issue will be whether a local tax is considered “complementary” to the new tax or a separate one from it.
  • Expect confusion. The laws transposing the Directive into the EU member states legal system will necessarily require sufficiently clear and detailed guidance.


Juan Riancho | Partner | BALL PLLC
Madrid, Spain