Global Minimum Tax Won’t Limit Developing Country Investment

The global minimum tax, a part of the OECD-led tax agreement, is unlikely to force a mass exodus of multinational companies from developing countries, a top economist said Tuesday.

Pierce O’Reilly, head of business and international taxes at the Organization for Economic Cooperation and Development, noted that the minimum tax’s substance-based income exclusion rule will continue to support investment into low-capacity countries that tend to offer significant corporate investments. He was speaking at the OECD’s two-day “Tax and Development Days” forum.

The exclusion allows companies to deduct a part of the income from their economic substance they create through ...