On 23 June 2023, the Danish Ministry of Taxation introduced a draft bill for public review, with the objective of incorporating the EU minimum tax directive. The implementation process of the directive adheres to the guidelines set forth by the OECD’s Pillar Two Model Rules, with the aim of meeting the directive’s stipulated deadline of 31st December 2023.
In brief, the directive aims to establish a minimum level of taxation (set at 15%) for multinational corporations within the European Union, thereby ensuring a consistent global standard. The draft bill closely aligns with the directive in terms of its language and structure, which implies that for taxpayers following the calendar-year basis, the rules will be applicable starting from 1 January 2024, through the “income inclusion rule” (IIR). The implementation of the “under-taxed profits rule” (UTPR) will follow one year thereafter.
The proposed draft law is scheduled to be enforced from 1 January 2024, impacting financial years commencing on or after 31 December 2023. Stakeholders are invited to provide their feedback on the draft until 18 August 2023.
