Monaco Moves Forward with OECD Global Minimum Tax Reform
The Principality of Monaco has taken another significant step towards aligning its legal framework with international tax standards by introducing legislation to implement the Organisation for Economic Co-operation and Development (OECD)’s global minimum corporate tax framework for large multinational groups.
As part of its ongoing commitment to international cooperation and the OECD’s Base Erosion and Profit Shifting (BEPS) initiative, the Princely Government has submitted a draft law to the National Council proposing the introduction of a Qualified Domestic Minimum Top-up Tax (QDMTT).
The proposed measure applies exclusively to multinational enterprise groups with annual consolidated revenues exceeding €750 million, ensuring they are subject to a minimum effective corporate tax rate of 15%, in line with the OECD’s Pillar Two framework.
According to the Government, the reform is designed not to increase the tax burden on affected companies, but rather to safeguard Monaco’s fiscal sovereignty. Without a domestic implementation of the OECD rules, any additional tax due could instead be collected by foreign jurisdictions where these multinational groups operate through subsidiaries or parent companies.
By adopting the QDMTT, Monaco aims to ensure that tax revenues generated from economic activity within the Principality remain within its own jurisdiction rather than being transferred abroad.
The Government also believes the reform will strengthen Monaco’s attractiveness as an international business destination. A tax framework recognised by the OECD provides multinational companies with greater legal certainty while reducing the risk of additional compliance obligations or administrative procedures that could arise if Monaco were not to implement the international standards.
The initiative reflects the Principality’s continued commitment to transparency, international tax fairness and compliance with globally recognised OECD standards, while preserving its competitiveness in an evolving international fiscal landscape.
The draft legislation will now be examined by Monaco’s National Council as part of the legislative process.