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Next step in DAC9 legislation: Council of the European Union reaches agreement on standardisation of GIR
Next step in DAC9 legislation: Council of the European Union reaches agreement on standardisation of GIR
In mid-February, the European Parliament (EP) voted by a majority to adopt the DAC9 legislative initiative. Now, the Council has reached a political agreement on the new EU directive. It acts as the sole legislator and will formally adopt DAC 9 after the revision is completed. The previous proposal by the European Commission primarily aims to simplify and standardise reporting obligations and the exchange of information on global minimum taxation.
Background
The new directive amendment aims to enable multinational companies under Pillar 2 to report the data relevant for the required GloBE Information Return in an EU jurisdiction through a single entity. If the formal adoption of the legislative proposal by the Council fails, GIRs would have to be submitted separately for each jurisdiction. After the Council’s formal approval, the directive is to be implemented into national law by the end of 2025.
According to the Council’s press release, countries that previously opted for a later implementation of the Pillar 2 directive must still implement the DAC 9 directive within the same timeframe.1 It remains to be seen how member states will shape the directive and its implementation at national level. The first reporting year is 2024, with companies whose fiscal year matches the calendar year required to submit the first GIR by June 30, 2026. For subsequent fiscal years, a 15-month deadline will apply.
Supporting tax departments in data management
The use of specialised software solutions can significantly simplify tax calculation and reporting processes. The key advantage of the Forvis Mazars Pillar 2 Tool lies in its ability to centrally capture all necessary data points. The tool converts data into the required format and, where possible, automatically reports it to the tax authority.
Significance for practice
Companies should prepare for the adoption of the legislative initiative and become DAC9-compliant. The national shaping of the directive is particularly awaited. Even if companies are promised some relief from bureaucratic obligations, the challenges associated with collecting and ensuring the quality of relevant Pillar 2 data remain.
Contact
For technical questions, the Forvis Mazars Digital Tax Team led by partner Christian Würschinger is available. For tax queries and questions about the advisory approach for the Pillar 2 tool, the Forvis Mazars International Tax team led by partner Florian Mengele is at your disposal.
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