Corporate tax is a taxable part of the income of a business after running cost and other necessities has been deducted, the fuss around a global minimum wouldn’t be if not for Digitization/Globalization the world is digital and there is no new news Giants in the industry do not favor digital service tax which is a growing trend worldwide and would prefer a new global minimum an (1) article on business insider (Africa) indicates Industry giants  would rather a new global minimum, so what is “Global corporate tax” honestly the easiest way to understand it would be to see it as corporate income tax  at an international level (as it would only affect overseas profit) the USA is pushing for an overhaul of corporate tax globally to address issues rising from digitization and provide a uniform substitute rule (for Digital service Tax) that would better cater for the new dynamics of business this new international tax rule is aimed at resolving the issues rising from Digitization.

Through the OECD she is proposing the content of a two pillared blueprint be adopted as the new rule for member of her  “Inclusive framework”  and be the Tool for resolving Tax issues between Taxpayers and Tax Administrations the world over,   if you’re wondering why USA, OECD and G20 nations Adopted this inclusive framework you need to understand Major economies intend to discourage multinationals from shifting profit to low tax Countries, USD 70b could be Realized as new tax revenue if the new minimum is set at %15 according to OECD (Organization for Economic Co-operation and Development) and this headline on (2) BBCUS challenges 'unfair' tech taxes in the UK and EU”  if anything is an indication of what could be if there’s no uniform rule, we cannot over emphasize the need for implementing a global minimum on Global corporate tax as the dynamics of business has evolved thanks to Digitalization/Globalization a uniform rule has to be set to avoid conflicts and keep businesses in their home country.


It would capture two category of businesses (ADS)  Automated Digital Services and  (CFB) Consumer-Facing Businesses, This captures many business but a threshold would be set and only businesses whose income exceed that threshold would be taxed according to the new international tax rule.

Note that governments can still set income tax at whatever percentage they want in their jurisdiction as this new rule only applies to overseas profit one of its major goal is to eliminate profit-shifting incentives for multinationals when they move profit to low tax jurisdiction as their home government under this new rule can “Top Up” their tax to the adopted minimum rate.


Online advertising services;

The sale or other alienation of user data;

Online search engines;

Social media platforms;

Online intermediation platforms;

Digital content services;

Online gaming;

Standardized online teaching services; and

Cloud computing services.


An MNE would be regarded as being a  (3) “consumer-facing business” if the MNE is the owner of the consumer product/service and holder of the rights to the connected intangible property (including franchisors and licensors). This is the MNE whose “face” is apparent to the consumer.

To be an “owner” in this context, the MNE must own the product and the related brands.

A very good example would be fast food and restaurants franchisors.

Exclusions and Carve-outs

These are businesses and industries that would be considered out of scope in the proposed rule in new international tax rule.  

Natural resources

Financial services


Sale and leasing of residential property

International Airline and Shipping businesses.


International tax rules in form of Tax Treaties between countries exist but Multinationals have always found a way to manipulate the system in their favor, In 2015 November the BEPS (Base Erosion and Profit Shifting) project marked a substantial renovation in international tax rules then in January 2019 members of the “Inclusive Framework” agreed to examine proposals in two pillars.

Talks around a global cooperate tax minimum continues to gain a place in our conversations lately whispers from different quarters it’s likely the biggest topic in the corporate world lately concern and recommendations continue to pour in and we await the outcome of the next G20 summit scheduled for October 30th - 31st 2021 as we continue to wait for the outcome of the summit to know what’s next and to monitor implementation of the new rules/recommendations in (pillar one and two blueprints) if it is approved and adopted, the average corporate tax rate in Africa is %25 to %30. Plus, setting a new minimum way below this average is sure to raise some question but work is in progress and we expect that before the final document is presented most of this would have been identified and resolved Tax administrators have also done well round the world (by creating new or amending their tax laws to tax digital services) in Nigeria there’s (4) provision for Multilateral arrangements/agreements which Nigeria is or would become a party of to apply in lieu (of the significant economic presence order of  section 13(2) (c) and (e) of Nigeria’s Companies Income Tax Act) for any In-scope company captured in such agreement/arrangement which begs the question what would happen to companies who exceed the Nigerian threshold set in her Significant Economic presence order but are not captured in that arrangement/agreement?  I honestly think we’ll just have to wait and see though one would like to think issues like this are part of the technical work been done by OECD currently.

(1)  https://africa.businessinsider.com/tech/big-tech-and-government-officials-have-praised-the-significant-unprecedented-g7-deal/e2nb5je

(2) https://www.bbc.com/news/business-52896266

(3) OECD (2020), Tax Challenges Arising from Digitalisation – Report on Pillar One Blueprint: Inclusive Framework on BEPS,

(4) https://mnetax.com/nigeria-clarifies-new-tax-on-nonresident-digital-businesses-39269