Global Daily Tax News, Denmark Enacts Law Amending Pillar Two Regime, (Jun 20, 2024)

Denmark has enacted legislation to update the nation's provisions for implementation of the Pillar Two minimum tax framework on large multinational enterprises.

The legislation also ensures that the list of territories subject to defensive measures remains aligned with the EU's list of non-cooperative territories.

The update to Denmark's minimum tax regime is intended to ensure that the provisions are in step with the OECD's model rules as well as administrative guidance on implementation released by the OECD on December 18, 2023.

Specifically, the Agreed Administrative Guidance for the Pillar Two GloBE Rules is intended to supplement the Commentary to the Global Anti-Base Erosion Model Rules to clarify the model rules application, including guidance on the application of the Transitional Country-by-Country Reporting Safe Harbour and a mechanism for allocating taxes arising in a Blended Controlled Foreign Corporation (CFC) Tax Regime when some of the jurisdictions the MNE operates in are eligible for the safe harbor.

The legislation will be effective from July 1, 2024.