The Korea Tax Centre(KTC) held the Knowledge Exchange and Training Program (KETP) for the Directorate General of Taxes of the Indonesia Ministry of Finance in Bali, Indonesia from 12 (Monday) to 15 (Thursday) August 2024. The program focused on the GloBE rules for Indonesian tax authorities, covering the overall concept of the GloBE rules and discussing the implementation of the rules in Indonesia, referring to the cases of other countries. 

The program was attended by 35 tax officials from the Indonesian Ministry of Finance. The speakers included Ms. Jessica de Vries (OECD), who is an Advisor of OECD Centre for Tax Policy and Administration, Mr. Massimo Bucci (Italy), who is an official from the Italian Ministry of Finance and Economy, Mr. Michael Hashemi (UK) with more than 10 years of experience in HM Revenue & Customs and Treasury, Ms. Melinda Brown (OECD), who is a Senior Advisor from OECD's Centre for Tax Policy, and Mr. Soo Jin Lee (Korea), an foreign accountant in Kim & Chang. The experts were experienced in the design of the GloBE rules, Pillar 2 or familiar with the implementation process of GloBe Rules in Korea.

On Day 1, Jessica de Vries provided an overview of the GloBE Rules and recent progress. She covered the GloBE rules and the Qualified Domestic Minimum Top-up Tax(QDMTT) and introduced the Income Inclusion Rule(IIR), which taxes the additional tax amount if the actual tax rate paid by a company is less than 15%, and the Undertaxed Payment Rule(UTPR), which is the complementary method when IIR does not apply. Massimo Bucci then explained the economic impact of the GloBE rules and tax incentives. He explained that the application of the GloBE rule can reduce differentiation in effective tax rates and reduce the low-taxed profit. Jessica de Vries and Massimo Bucci introduced the concept of tax preferential rules under the GloBE rules and explained the methods to implement the rules. They introduced the case of Indonesia and explained the methods of tax incentives and possible consequences of each method.

On Day 2, the event focused on the practical application of the GloBE rules, explaining the concepts and accounting methods for each rule. Michael Hashemi (UK), Melinda Brown (OECD), and Jessica de Vries (OECD) explained how to define GloBE profits and losses, set and adjust applicable taxes, calculate Effective Tax Rate(ETR) and top-up taxes, and allocate tax liabilities and profits. After explaining the principle, case analyses were used to help participants understand and apply the GloBE rules in practice.

On Day 3, Michael Hashemi (UK) and Jessica de Vries (OECD) explained how to draft legislation. They explained how to apply the GloBE rules to domestic law to create legislation that complies with global tax standards and is tailored to a country's tax environment and economic needs. He explained the different ways of applying the GloBE rules to domestic law, introduced points to consider when applying them. Soo Jin Lee (Korea) then explained how to apply the GloBE rules technically. She explained the limitations of enacting domestic laws and the relevant authorities, and provided various examples in Korea, for instance, the domestic adoption process, accounting system, and calculation and adjustment of additional taxes. She mentioned the main principles and applications of tax neutrality. She discussed the GloBE rules, the tax neutrality and distribution regime. Melinda Brown (OECD) explained the importance, main functions and objectives of the Qualified Domestic Minimum Top-up Tax (QDMTT) and safe harbor. She explained that the QDMTT contributes to compliance with the GloBE rules, reducing unnecessary competition and preventing tax avoidance, and that safe harbors provide stability to the rules and provide a baseline for administration.

On Day 4, the last day, Michael Hashemi and Massimo Bucci presented making reports under the GloBE rules. They explained the main contents and procedures of the GloBE information return, the main contents and procedures of the QDMTT report, and discussed the relationship between each report. After the lecture, the event concluded with a closing ceremony.

Through focused and thorough pre-meetings between institutions, it was possible to understand and actively reflect the needs of the Directorate General of Taxes of the Indonesia Ministry of Finance, which lead to passionte participation and interest from the participants. The speakers participated in the design of the BEPS practice or had practical experiences in Korea and this ensured that the participants gained the practical and applicable knowledge through active discussion with the speakers.