The United States and India have announced an extension of their agreement regarding the transition from India's existing Equalization Levy to a new multilateral solution agreed upon by the OECD-G20 Inclusive Framework. This announcement follows the historic agreement reached on October 8, 2021, between over 130 countries under the G20/OECD Inclusive Framework, which introduced a two-pillar package of reforms to the international tax framework.
In support of this agreement, the United States and India initially announced terms for a political compromise on November 24, 2021. The terms outlined a transition from India's current Equalization Levy to the newly proposed multilateral solution and committed both nations to ongoing discussions through constructive dialogue.
Given the ongoing multilateral negotiations at the G20/OECD Inclusive Framework, both countries have now agreed to extend this political compromise through June 30, 2024. This extension aligns with the revised timeline set forth by the Inclusive Framework.
