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ИД «Финансы и кредит»






Finance and Credit

Proposed novations in global taxation

Vol. 29, Iss. 2, FEBRUARY 2023

Received: 24 November 2022

Received in revised form: 19 December 2022

Accepted: 9 January 2023

Available online: 28 February 2023

Subject Heading: FISCAL SYSTEM

JEL Classification: F53, H25, H87

Pages: 423–441


Andrei K. LYAMENKOV Lomonosov Moscow State University, Moscow, Russian Federation


Subject. Tax competition between jurisdictions, contributing to profit removal of multinational enterprises (MNEs) from taxation is a serious problem in the global economy. To solve it, an international agreement was concluded in 2021 with a wide range of participating countries, which contains important novations for the entire system of global taxation. However, its implementation is an open question.
Objectives. The aim is to provide a unique study of the content of the proposed novations in global taxation, and possibilities and prospects for their implementation in national legislation.
Methods. The study employs general scientific methods, like abstraction, induction, deduction, synthesis, comparative analysis.
Results. The paper describes the content of two components of the said agreement, gives a forecast of possible consequences of their application for MNEs’ profit taxation, substantiates the position that in the modern terms of world economy, the implementation of these novations will be postponed.
Conclusions. The novations contained in the international agreement of 2021 specify the application of the territorial principle of taxation for MNEs’ income (pillar 1) and introduce the minimum allowable level of tax on their corporate profits (pillar 2). The implementation of the novations will influence the overall level of corporate taxation in separate countries, especially in low-tax jurisdictions, limit the possibilities of international corporate tax planning and removal of profits from taxation, and modify the practice of granting tax preferences to businesses. However, under current economic and political turbulence in the world economy, one should not expect imminent implementation of the novations into national legislation.

Keywords: global taxation, territorial principle of taxation, multinational enterprise, digital company, tax base erosion


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ISSN 2311-8709 (Online)
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Vol. 29, Iss. 2
February 2023