Draft bill on the German Minimum Tax Amendment Act published

What changes are planned to the Minimum Tax Act (MinStG)?

Alongside the provisions already included in the first and second discussion drafts of 20 August 2024 and 5 December 2024, the draft bill on the Minimum Tax Amendment Act (MinStAnpG) also picks up the OECD Agreed Administrative Guidance published in January 2025 (particularly on Article 9.1 of the OECD Model Rules).
This is designed to now implement in full all the rules published by the OECD up till now into national law.

Key changes particularly concern the transitional provisions on minimum tax (sections 82 f. Minimum Tax Act (MinStG)).

The focus includes preventing potential arrangements, particularly with state interventions, such as the use of (artificial) deferred tax assets to increase the effective tax rate. Also, new requirements are being introduced on safe harbour as part of qualified domestic minimum top-up tax (QDMTT) (sections 87 f. Minimum Tax Act (MinStG)), including:

• the use of standardised reporting packages
• specific application rules on the acquisition method
• additional anti-abuse rules on the prevention of arrangement abuse.
• The rules will apply retrospectively, in view of their anti-tax avoidance function.

Transposition of the DAC 9 Directive

Another component of the draft bill is transposition of EU Directive 2025/872 (“DAC 9”) of 14 April 2025. The goal of this is to standardise the exchange of information on minimum tax reporting within the EU. This is designed to simplify the application of section 75(2) of the Minimum Tax Act (MinStG), which provides for GloBE information reports (GIR) to be submitted once in a Member State. This will reduce the administrative burden on international companies and foster legal certainty in cross-border contexts.

Accompanying measures in the Income Tax Act and Foreign Tax Act

In addition to amendments to the Minimum Tax Act (MinStG), the draft bill lays down a draft of other changes to tax. These include:

• Discontinuance of the royalty deduction limitation rule under section 4j of the Income Tax Act (EStG) starting from tax year 2025
• Overhaul of the allowance thresholds in the Foreign Tax Act (AStG) for controlled foreign corporations (section 9 AStG):
  - relative threshold (1/3)
  - absolute threshold (100,000 euros)
• Modification of the amount to be excluded for tax groups (section 11 AStG)
• Introduction of a 10 percent participation threshold for capital investments (section 13)
• Retrospective tightening of exit taxation
  (“previous cases” from before 1 January 2022):
  - Expansion of detrimental distribution of profits to include recurring cases (section 21)
• Avoidance of double add-backs for special investment funds (section 37 Investment tax Act (InvStG))

These accompanying measures aim at adapting to the new minimum tax architecture and close current regulatory gaps in national tax law.

Conclusion and outlook

The draft bill marks an important milestone on the way to the complete national transposition of global minimum taxation. It integrates OECD rules, EU Directives and adds targeted amendments in other tax legislation alongside the Minimum Tax Act (MinStG). Although the cabinet has not yet passed the bill, the legislative process is expected to move quickly.
International companies are well advised to study the planned changes now.
Safe harbour rules, exit taxation and investment structures in particular should be examined at an early stage and adjusted.

Grant Thornton Germany will support you in implementing the new minimum tax duties and in optimising existing structures with a view to the planned changes in the law.

Feel free to contact us.