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Article 9.2. Transitional relief for the Substance-based Income Exclusion

9.2.1. For the purposes of applying Article 5.3.3, the value of 5% shall be replaced with the value set out in the table set out below for each Fiscal Year beginning in each of the following calendar years:

Fiscal Year Beginning in Article 5.3.3. Rate
2023 10%
2024 9.8%
2025 9.6%
2026 9.4%
2027 9.2%
2028 9.0%
2029 8.2%
2030 7.4%
2031 6.6%
2032 5.8%

9.2.2. For the purposes of applying Article 5.3.4, the value of 5% shall be replaced with the value set out in the table set out below for each Fiscal Year beginning in each of the following calendar years:

Fiscal Year Beginning in Article 5.3.4. Rate
2023 8%
2024 7.8%
2025 7.6%
2026 7.4%
2027 7.2%
2028 7.0%
2029 6.6%
2030 6.2%
2031 5.8%
2032 5.4%

Article 9.2.1 and 9.2.2 – Substance-based Income Exclusion

11. Article 9.2.1 provides the relevant percentages for the purpose of applying the payroll carve-out in Article 5.3.3 for Fiscal Years that begin in the transition period of ten calendar years beginning with 2023. For example, if a MNE Group has a Fiscal Year that commences on 1 March 2023, the applicable percentage to be applied for the Article 5.3.3 payroll carve-out in that Fiscal year is 10%.

12. This transition period applies regardless of when a MNE Group comes within the scope of the GloBE Rules. For example, if a MNE Group first becomes subject to the GloBE Rules in the Fiscal Year that commences on 1 January 2026, the applicable percentage to be applied for Article 5.3.3 in that Fiscal Year is 9.4%.

13. Article 9.2.2 provides the relevant percentages for the purpose of applying the tangible asset carve-out in Article 5.3.4 for Fiscal Years that begin in the transition period of ten calendar years beginning with 2023. The same principles described in the Article 9.2.1 Commentary apply with respect to Article 9.2.2.

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