Author: Parth Dhanaraj Chide, Savitribai Phule Pune University

This article explains the way some countries impose tax on even digital earners who don’t have their existence in form of physical project called digital taxation. It also explains the role of Global Corporate Minimum Tax Proposal structured by G7 countries in order to maintain balance of foreign investment all over globe. It also ensures to prevent the damages of Base Erosion and Profit Shifting an action plan by G20 and OECD which allows large companies to shift their profits earned from tax jurisdiction with high rate to the tax jurisdiction having low or no corporate tax rate. It also deals with the explanation of two pillars invented with Digital taxation and Global Corporate Minimum Tax Proposal. Also this paper ensures to explain the criterias which makes a country a Tax Haven , how the country with zero tax rate or with no tax rate earns a benefit or their share in different ways or in different forms of charges. How the tax avoidance is not illegal but unethical, Contratory tax aviation is illegal is well articulated by this article. IP restructuring, Thin Capitalisation, Double Irish Dutch Sandwich are few techniques to avoid tax as summarised by this article. The Global Minimum Corporate Tax Proposal also has challenges from the country who wanted to impose tax on every institution earning income or revenue from their country.But the challenges they faced is they were allowed to impose only on top of MNE or or MNC’s.The other  challenges faced by country having low tax rate is they has to impose at least 15% corporate tax in other way, there foreign investments was going to reduce. Digital Taxation has a vital sustainable scope for all over the globe. Also Global Corporate Minimum Tax is going to maintain balance between all over countries.

Keywords 

OECD , Tax Jurisdiction, Tax Haven , IP restructuring, DST, Corporate, BEPS

In THE HINDU newspaper Jane Yellen a 78^th United State treasury secretary commented ’30 year race to the bottom on corporate tax rates’ well introduces the term Digital Taxation And Global Minimum Corporate Tax. During research it gets clears to mind that this agreement or landmark creates the basis for a worldwide deals of economy. This will look after the multinational companies or multinational enterprises whether they pay taxes or moves to the country having low tax rates or if they pay less taxes , then they get penalized with ‘top up tax’ in mainly two different ways. BEPS (Base Erosion Profit Shifting) was allowing one country to attract high foreign investment whereas it also prevents the country having higher tax rate to earn profit or investment of foreign countries. This leads to an imbalance of revenue earned all over the globe. So to maintain this balance and to provide fair opportunity to the every country for earning higher investments is the primary objective of Global Minimum Corporate Tax Proposal. Mainly it introduces to two pillar solution.

Pillar One : Based on where consumers are earning,rather than solely on physical presence.Aims to address challenges of digitalization and profit Shifting. Allocates a portion of Multi National Companies profits to make markets.

Pillar Two : Establishes a global minimum effective tax rate (ETR) of 15% on a country - by – country basis. Applying to multi national institutions exceeding revenues, with exceptions. If an ETR in a country falls below 15%, it must pay top up tax to its parent company’s jurisdiction.

This is all about pillars of Global Minimum Corporate Tax Proposal,

But it also comes with demerits ;

It prevents the country from imposing taxes on digital advertisement,e- e-commerce . It mandates the low tax jurisdiction to impose at least 15% of corporate taxes.

Highlighting the importance and effect of Global Minimum Corporate Tax Proposal over the world’s economy , many top researchers, institutions, journals studied on Global Minimum Corporate Tax Policy or agreement and published their papers. Including Organization of Economic Cooperation And Development, G20 , International Monetary Funds , World Bank Group, Taxation and Customs Union and many other research bodies publish their policy papers.Also University Of Oxford mainly explains in their paper how this policy can lead to global public welfare. Also many countries have a debate on this topic at the initial point concerning of discrimination , fair opportunity, DST’s impact on growth etc. To bring uniformity in the world of corporate taxation is the important need of Global Minimum Corporate Tax globally.

Few limitations of it are its intricate complex nature, also requires regular updating and adaptation are important limitations.

Source Country,Tax jurisdiction,DST, Domestic Country are some key perspectives and new terms we learn.

The objective of this research are

• To bring race to the bottom, to establish uniform taxation.

• To attract foreign investment globally, to maintain revenue all over the globe, to promote infrastructure.

The methodology used here is analytical, descriptive, theory based review. Here the data obtained gets analysed to study various affects, challenges ,theories and importance of proposal. The rules or act for its basis is known to be GloBE (Global Anti – Base Erosion) Model rules.

This section deals with sub issues, challenges , rules and the new methods, terms we interpret or learn.

The sub issues in GloBE rules are Complexity in implementation, regular adaptation and updation, sovereignty concern , political consensus and economic challenges.

The challenges faced by Global Minimum Corporate Tax are 

If international taxes are not drafted, it may largely affect low tax countries, the implementation of pillar two and the global minimum tax requires careful consideration, stakeholder consultation is vital to address concerns, minimize compliance burdens, and the G20 countries which are all set to meet in July 2021 must also be on board with terms of global minimum tax rate.

This Section highlights the interpretation, insights, outcomes derived from the research article. Findings of Global Minimum Corporate Tax Proposals 

Need for Unified Approach : A global solution was necessary because unilateral efforts were insufficient to stop institutions from exploiting differences in tax laws.

Inequity concerns : Some low and middle income countries criticized the OECD – led deal, arguing it disproportionately benefits high income G7 countries in collection of new top up taxes.

Prevalence of Tax Avoidance : MNC’s used loopholes to shift profits to low tax or no – tax jurisdiction, effectively becoming “tax havens”.

Public Support : Surveys in EU members indicated a high level of support.

The best example of its conclusion is the USA which has fallen or reduced its corporate tax to 21% but due to some more required amount for the country's welfare it has to increase corporate tax and here the treasury secretary talks about Global Minimum Corporate Tax which has become the agreement all over the globe. This reports also concludes about the number of challenges it has to face but it also explains or lead to a conclusion that to establish balance of revenue profit all over globe, to establish uniform taxation, to have fair involvement of foreign investment all over globe it is must to practice Global Corporate Minimum Tax and Digital Taxation all over globe.

1. Organisation For Economic Co-operation & Development,https://www.oecd.org,

   (last visited December 7, 2025)

2. BYJU’S,https://byjus.com( last visited December 7, 2025)