Differing Commencement Dates For Pillar Two Internationally

From the draft legislation issued to date, the commencement date for the Pillar Two GloBE Rules varies amongst jurisdictions. The current proposals for Singapore, Hong Kong and Thailand are based on a 2025 commencement date for their Income Inclusion Rule, but even amongst other jurisdictions with a 2024 commencement date, the precise wording differs.

For instance, the wording can vary from ‘ On or after December 31, 2023’, ‘From December 31, 2023’ or ‘After December 30, 2023’ to ‘From January 1, 2024’ or ‘From April 1, 2024’. 

The current commencement dates from draft legislation issued are:

Country Start DateAnalysis
United Kingdom Accounting periods beginning on or after December 31, 2023GloBE Country Guide: The United Kingdom
GermanyAccounting Periods beginning after December 30, 2023GloBE Country Guide: Germany
JapanAccounting Periods beginning on or after April 1, 2024GloBE Country Guide: Japan
The NetherlandsAccounting periods beginning from December 31, 2023GloBE Country Guide: The Netherlands
SwitzerlandAccounting Periods beginning on or after January 1, 2024GloBE Country Guide: Switzerland
SwedenAccounting periods beginning after December 31, 2023GloBE Country Guide: Sweden
South KoreaAccounting Periods beginning on or after January 1, 2024GloBE Country Guide: South Korea

In practice, the above draft legislation may well effectively apply the Pillar Two GloBE Rules from January 1, 2024 for pretty much all in-scope MNEs (aside from in Japan). Nevertheless, there is a difference, and one reason for the potential discrepancy in the wording is interesting. 

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