GFIA position on global minimum taxation
The Global Federation of Insurance Association GFIA has submitted a position paper to the OECD on the implementation framework of the global minimum taxation. GFIA's position ist fully supported by the GDV.
The implementation framework is being developed at the level the OECD to support tax authorities in the implementation and administration of the minimum taxation rules. With its position paper GFIA contributes to the public consultation which was held by the OECD.
GFIA points to the complexities of the rules and calls for postponing the entry into force to the 1st of January 2024, further clarifications and the delevelopment of simplification measures such as safe harbour rules for high tax jurisdictions. Furthermore, GFIA comments on a number of aspects which are of particular concern to the insurance industry. One area of concern is the treatment of Restricted Tier 1 (RT1) instruments. The Model Rules released by the OECD/G20 Inclusive Framework on BEPS deal with tier-one-capital in the banking sector but do not contain adequate rules for RT1 instruments issued by insurers. Another area of concern is the treatment of investment funds. Under the Model Rules, top-up tax may be triggered in relation to investment funds although this would not be in line with the policy objectives of the minimum taxation - concept.