Teresa Teixeira Mota and Francisco Lencastre Torres signed the article ‘Navigating pillar two in Portugal: overcoming challenges with technological solutions’, published in the International Tax Review.

In this article, the VdA lawyers address the challenges of implementing Pillar Two in the European Union and in Portugal, highlighting the role of generative Artificial Intelligence (GenAI) in complying with the requirements of this new tax regime.

The recent transposition of the Pillar Two Directive into national legislation introduced the Global Minimum Tax Regime (GMTR), which provides for a global minimum effective tax rate of 15 per cent, applicable to multinational groups and large national groups with consolidated annual revenues of 750 million euros or more.

Teresa Teixeira Mota and Francisco Lencastre Torres analyse the main challenges of Pillar Two, such as tax calculation, the application of the rules on income inclusion (IIR), untaxed profits (UTPR) and qualified domestic minimum top-up tax (QDMTT), as well as compliance with reporting obligations.

GenAI is presented as an effective solution to meet these challenges by automatising the extraction, organisation and analysis of large volumes of data, standardising information, detecting anomalies and ensuring data integrity.

In addition, GenAI can easily calculate the effective tax rate and additional tax, and can model scenarios in real time, helping companies to comply with Pillar Two with greater efficiency, security and reliability.

  • This article is available here.