Global Finance 2025: BFAG's Overall Strategic Vision for International Markets
Boston Financial Advisory Group
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1. Global Minimum Tax Introduction
The OECD's Pillar Two model is designed to be fully implemented across all major economies by 2025, which is reshaping the international tax landscape.
Key elements of the global minimum tax include
At least 15% tax rate for MNEs
Income inclusion rule (IIR) and under-taxed payments rule (UTPR)
Substance-based carve-out provisions
BFAG Tip: Review impact on your foreign customers and facilitate them to their way out into better international tax positions.
Conduct a thorough examination of worldwide corporate frameworks.
Analyze the impact of the minimum tax on effective tax rates.
Develop strategies for substance alignment with value creation.
2. Digital money and CBDCs
Major economies are likely to introduce Central Bank Digital Currencies (CBDCs) by 2025, which will potentially revolutionize international transactions and monetary policy. Major Developments:
Launch of the digital dollar in the US
European Central Bank's Digital Euro project
Expansion of Digital Yuan in China
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BFAG Insight: Understand how CBDCs will alter the face of international transactions and financial reporting for your international clients
Determine the effects on cross-border payment systems.
Prepare for possible adjustments in cash management strategies.
Assess the implications for foreign exchange risk management.
3. Global finance and ESG integration:
Globally applicable standards in the reporting of ESG shall be converged by 2025, with a firm foundation from the International Sustainability Standards Board.?
Basic Building Blocks of International ESG Standards:
A single framework for climate-related disclosures
Standardized metrics on social and governance factors.
Integration of ESG risks within financial risk assessment
BFAG Advisory: Start harmonizing your clients' reporting practices with the emerging international ESG standards:
Analyze gaps between the current practices and the ISSB standards
Have good quality ESG data collection and verification processes
Include ESG factors in financial planning and risk management
Artificial Intelligence in Global Financial Services Artificial intelligence is going to change most aspects of global finance.