OECD Publishes Corporate Tax Statistics 2025: Global Trends and India's Position
SDG 17: Partnerships for the Goals | SDG 16: Peace, Justice and Strong Institutions
Institutions: Ministry of Finance | Central Board of Direct Taxes (CBDT)
The OECD’s Corporate Tax Statistics 2025 provides a comprehensive analysis of corporate tax systems across over 170 jurisdictions, including India. A defining trend in this year’s report is the global stabilization of statutory corporate income tax (CIT) rates, arresting a two-decade-long decline. The average global statutory CIT rate has leveled off at approximately 21.1%, largely attributed to the impending implementation of the Pillar Two Global Minimum Tax, which sets a floor of 15% on effective corporate taxation.
The 2025 report significantly expands its transparency data, featuring Country-by-Country Reporting (CbCR) statistics now disaggregated by MNE group size. This granular data allows tax authorities to better detect misalignment between where profits are reported and where economic activities (like employees and tangible assets) actually occur. The report also tracks R&D tax incentives, noting that while direct tax rates have stabilized, governments continue to use expenditure-based incentives to attract innovation-heavy investments.
India Specific Data & Context
The report and associated data highlight India’s strategic positioning within the global tax landscape:
Dual Tax Regime Structure: India maintains a competitive dual structure. The standard corporate tax rate ranges from 25% (for turnover up to ₹400 crore) to 30% (for larger firms), plus surcharges and cess.
Global Minimum Tax Alignment: Crucially, India’s concessional tax rate of 15% (effectively ~17% with surcharge) under Section 115BAB for new manufacturing companies aligns closely with the OECD’s Pillar Two 15% floor. This ensures that India remains a competitive investment destination without ceding tax revenue to other nations via “top-up taxes.”
R&D Incentives: India continues to offer substantial support for innovation, including 100% deductions for in-house R&D expenses (Section 35) and a newly approved ₹1 Trillion R&D Fund to support deep-tech sectors, positioning it against global competitors using similar tax expenditures.
Effective Tax Burden: While statutory rates can reach nearly 35% for foreign companies, the effective tax rates (ETR) for domestic companies opting for the new regime (Section 115BAA) are significantly lower at approx 25.17%, enhancing India’s attractiveness relative to the global average.
Policy Relevance: For the CBDT, the new disaggregated CbCR data offers a powerful tool to refine transfer pricing risk assessments, targeting enforcement on large MNEs that report high profits in low-tax jurisdictions but have substantial operations in India. Furthermore, India’s 15% manufacturing tax rate effectively “future-proofs” its incentives against the Global Minimum Tax, ensuring that tax benefits offered to manufacturers stay within India rather than being taxed away by the MNE’s home country.
What is the “Pillar Two” Global Minimum Tax? → Pillar Two is a key component of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS). It aims to ensure that large Multinational Enterprises (MNEs) pay a minimum effective tax rate of 15% in every jurisdiction where they operate. If an MNE pays less than this minimum rate in a subsidiary country (e.g., a tax haven), their home country can levy a “top-up tax” to bring the effective rate to 15%, thereby reducing the incentive for profit shifting.
Follow the full news here: OECD Corporate Tax Statistics 2025