India’s Ministry of Finance has declared it will not endorse Pillar One of the OECD’s two-pillar tax solution until specific concerns are resolved. Key issues include the proposed dispute resolution mechanism, which India opposes being subject to international arbitration, and the treatment of withholding tax.
Revenue Secretary Sanjay Malhotra, one of the top finance ministry officials, said,
India is “constructively engaging” with all the countries for the successful conclusion of Pillar One, and was hopeful the deal would be finalised soon.
Simultaneously, the Ministry has appointed a panel to prepare for the implementation of Pillar Two, which establishes a global minimum tax rate of 15% for multinational enterprises.
