Executive summary

On 26-27 February 2025, the first meeting of the G20 Finance Ministers and Central Bank Governors (FMCBG) under the South African G20 Presidency, was held in Cape Town. According to press reports, the finance ministers from Canada, China, India, Japan and the United States did not attend the meeting.

At the conclusion of the meeting, the Chair issued a summary (Chair's Summary) of the discussion. It invites the Organisation for Economic Co-operation and Development (OECD)/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) to report on progress on BEPS by the October 2025 G20 FMCBG meeting. The Chair's Summary also calls for new work on strengthening revenue administrations and understanding how tax policies in the field of individual taxation may affect inequality. In addition, the Chair's Summary encourages constructive engagement in the development of the United Nations (UN) Framework Convention on International Taxation Cooperation.

In connection with the G20 FMCBG meeting, the OECD released its Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors (the Report), outlining recent developments in international tax cooperation and emphasizing the OECD's support for G20 tax initiatives. The Report provides updates on Pillar One and Pillar Two developments and implementation of the BEPS minimum standards. Additionally, it describes ongoing work on tax and development, and enhancing tax transparency, including developments with respect to the Crypto Asset Reporting Framework (CARF). The Report also outlines OECD plans to develop a report on the intersection of tax policy and inequality, as requested by the South African G20 Presidency.

Detailed discussion

G20 Chair's Summary

The Chair's Summary of the February 2025 G20 FMCBG meeting reports on discussions and outcomes of the meeting. The Summary indicates that there was no consensus for a meeting communiqué. On international taxation, the Summary begins by noting the G20's role in maintaining momentum in discussions of the international tax agenda and expressing support for the work on Pillars One and Two, stating that the G20:

23. Welcomed the broad support for continuing discussions on the international tax agenda. Remained confident that the G20 is the relevant body to ensure that positive momentum on this work is maintained. The South African G20 Presidency invites the OECD/G20 Inclusive Framework (IF) on Base Erosion and Profit Shifting (BEPS), in consultation with international organisations, to report to us by the October meeting on the progress on BEPS; and the OECD in conjunction with the Global Forum on Transparency to take stock of progress on transparency initiatives since the inception of the G20. Noted the progress made on the Two-Pillar Solution. Acknowledged the concerns and the need to respect the sovereignty of each country and supported the swift implementation of the Two-Pillar Solution by all interested jurisdictions, including expeditious completion of negotiations on the final package of Pillar One. Recognising that many countries have made progress in implementing Pillar Two, the South African G20 Presidency calls on the OECD/G20 IF on BEPS, in cooperation with international organisations, to provide country-based specific technical support to developing countries.

The Chair's Summary also references the challenges that developing countries face in benefiting from international tax developments. It calls on the Platform for Collaboration on Tax — a joint initiative of the International Monetary Fund, the OECD, the United Nations, and the World Bank Group — to coordinate efforts to enhance technical assistance, explaining that the G20:

24. Raised the issue that developing countries are struggling to mobilise domestic resources and benefit from international tax reforms. Recognised that domestic resource mobilisation is foundational to achieving fiscal sustainability and SDGs. Called on the partners of the Platform for Collaboration on Tax (PCT) and regional organisations to coordinate and report on progress in strengthening capacity-building frameworks to enhance the effectiveness and efficiency of technical assistance, as stated in the Rio de Janeiro G20 Ministerial Declaration on International Tax Cooperation. The IMF is requested, in consultation with the other PCT partners, to compile a report on how to strengthen revenue administrations, as a follow up to its note "Alternate Options for Revenue Mobilisation" to the Brazilian Presidency.

In addition, the Chair's Summary calls for new work on the relationship between tax policies and inequality and references various ongoing tax-related workstreams, including OECD work on simplifications to promote tax certainty and UN work on a new Framework Convention on International Taxation Cooperation:

25. Recalling the Rio de Janeiro G20 Ministerial Declaration on International Tax Cooperation, pushed for the OECD/G20 IF on BEPS to work on understanding how tax policies may exacerbate or mitigate inequality, including by discussing potentially harmful tax practices and aggressive tax planning in the field of individual taxation, while respecting the sovereignty of each country. Called on the OECD to report on progress to exchange foreseeably relevant information regarding real estate for combating tax evasion and avoidance purposes on a voluntary basis and to continue the discussion on the access of beneficial ownership information where it is foreseeably relevant. Looked forward to the OECD reporting on its work plan to put forward simplifications, to promote tax certainty and reduce compliance costs while maintaining the integrity of existing tax rules. Mindful of the need for an inclusive, effective and stable international tax system, encouraged continued and constructive engagement with parties in the ongoing discussion on the development of a UN Framework Convention on International Taxation Cooperation with the aim of reaching broad consensus, maximising synergies among the existing international fora, while seeking to avoid unnecessary duplication of efforts.

February 2025 OECD Secretary-General Report

The OECD's Secretary-General Tax Report to G20 FMCBG provides an update on recent developments in international tax cooperation and reiterates the OECD's commitment to working with the G20 to deliver reports on tax priorities of the G20.

The Report provides an update on recent developments with respect to Amounts A and B under Pillar One and the Global Anti-Base Erosion (GloBE) Rules and the subject-to-tax rule under Pillar Two. The Report also provides an update on activity relating to jurisdictional implementation of the minimum standards under the original BEPS project, noting that many jurisdictions have made progress in aligning their domestic laws with these standards. In addition, the Report includes brief descriptions of the OECD's ongoing work on transfer pricing, digital tax administration and statistical analysis. It also outlines the OECD's planned workstream on tax and inequality, which includes a scoping report to be developed at the request of the South African G20 Presidency, as well as continuing work on tax certainty, another area of G20 interest.

The Report provides an outline of the OECD's work on tax and development, including capacity-building activities related to implementation of BEPS project measures and Pillars One and Two, as well as other training and assistance programs for developing country tax administrations. It also contains a summary of the work of the Global Forum on Transparency and Information Exchange, including developments with respect to the CARF, continued progress on automatic exchange of financial account information and ongoing capacity-building relating to effective information exchange.

Implications

The G20 Chair's Summary reflects the evolving tax priorities of the G20 and the interest in partnering with a variety of international organizations on the international tax agenda. The Secretary-General Report provides an update on the OECD's ongoing work on a broad range of tax workstreams. It also outlines plans for future work in new areas, including work requested by the South African G20 Presidency on the intersection of tax policy and inequality.

Businesses should monitor tax discussions in the G20, as well as the tax work being done in the OECD, UN and other international organizations. They should also continue to follow proposals and legislative developments across relevant jurisdictions to prepare for potential tax changes. Staying updated on these developments will be crucial in navigating the complexities of the global tax landscape.