Meeting OECD Secretary-General, Sri Mulyani Discusses Pillars 1 and 2

JAKARTA. Minister of Finance Sri Mulyani and OECD Secretary-General Mathias Cormann held a meeting in Sao Paulo, Brazil. The meeting was held in the middle of the G20 agenda, on Thursday (29/2).

One of the contents of the meeting was to discuss Pillar 1 and Pillar 2, namely international taxation policies to prevent tax base erosion and profit shifting or Base Erosion and Profit Shifting (BEPS).

Minister of Finance Sri Mulyani stated that on this occasion she conveyed suggestions and input related to the implementation of Pillar 1 and Pillar 2. The goal is to accommodate the creation of a fairer environment and more effective cooperation.

Pillar 1 regulates the right to global taxing of income received by multinational companies that are covered by the criteria. 

In this case, any multinational company that has a global business revenue above 20 billion Euros must reallocate more than 25% of its profits to be distributed to the jurisdiction where its customers or service users are located.  

Meanwhile, Pillar 2 regulates Global Anti-Base Erosion (GloBE) which requires the implementation of corporate income tax with a minimum rate of 15%. The minimum tax targets all multinational companies with a business revenue of more than 750 million euros a year.   

In addition, during the meeting, Sri Mulyani also expressed her appreciation for the support of Mathias and all OECD member countries for Indonesia's accession. "This support is important in continuing Indonesia's full membership process," Sri Mulyani said.

For information, previously the OECD decided to open accession discussions with Indonesia, as an advanced stage of Indonesia's request to become a member of the organization. (ASP)