On December 27, 2024, the bill Inland Revenue (Amendment) (Minimum Tax for Multinational Enterprise Groups) Bill 2024 was gazetted in LegCo. This bill implements the global minimum tax regime in Hong Kong for multinational enterprise ("MNE") groups with annual consolidated revenues of EUR 750 million or above, introducing the Hong Kong Minimum Top-Up Tax ("HKMTT") to ensure a minimum tax of 15% on profits.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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On December 27, 2024, the bill Inland Revenue (Amendment) (Minimum Tax for Multinational Enterprise Groups) Bill 2024 was gazetted in LegCo.
The bill is about the implementation of the global minimum tax regime in Hong Kong, specifically aimed at multinational enterprise ("MNE") groups with annual consolidated revenues of EUR 750 million or above. This includes introducing the Hong Kong Minimum Top-Up Tax ("HKMTT") to ensure that in-scope MNE groups pay a minimum tax of 15% on profits derived from every jurisdiction where they operate.
The bill aligns Hong Kong with the OECD's BEPS 2.0 package by incorporating the Income Inclusion Rule ("IIR") and the Undertaxed Profits Rule ("UTPR") to address base erosion and profit shifting risks. The proposed regime aims to uphold Hong Kong's tax competitiveness while minimizing compliance burdens for in-scope MNE groups.
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