OECD Bars Some Deferred Tax Assets in Global Tax Calculation (1)

Certain deferred tax expenses will be excluded from transitional global minimum tax calculations under new OECD guidance, in an effort to prevent taxpayers from manipulating such calculations.

The guidance released Monday says taxpayers can’t use deferred tax expenses that arise from the reversal of deferred tax assets stemming from “governmental arrangements” in determining their effective tax rates for purposes of the global minimum tax during a transition period.

Expenses from the reversal of DTAs that arise from certain government grants of basis step-ups when introducing a new corporate income-tax regime would also be excluded from the calculations, the OECD said. ...