Pillar 1 Amount A — Reallocation of Residual Profits

Amount A is the centrepiece of OECD Pillar 1, creating an entirely new, nexus-independent taxing right for market jurisdictions. It ensures that large, highly profitable multinational enterprises pay tax in countries where they generate significant sales and economic activity without necessarily having a physical presence. Amount A is fundamentally sector-agnostic and covers all industries, with certain regulated financial services entities and extractives excluded.

• Covers MNE groups with global turnover exceeding EUR 20 billion and profitability above 10%
• 25% of residual profits (profits above a 10% profit margin) reallocated to market jurisdictions
• Revenue threshold for market jurisdictions: EUR 1 million (EUR 250,000 for smaller economies)
• Replaces existing Digital Services Taxes (DSTs) and similar measures
• Implemented through a Multilateral Convention (MLC)

Debates over taxing digital companies led to the introduction of unilateral Digital Services Taxes in several countries during the 2010s. In response, the OECD/G20 Inclusive Framework launched the Unified Approach project in 2019, which evolved into Pillar 1 Amount A. In October 2021, 136 jurisdictions agreed on the framework concept. As part of this agreement, a DST Standstill Agreement was concluded, intended to prevent the introduction of new unilateral digital taxes. The text of the Multilateral Convention (MLC) was finalised in October 2023 and opened for signature.

However, progress toward actual signatures stalled. The original signing deadline (mid-2024) passed without sufficient signatories, as did the extended deadline (end of 2024). In January 2025, the Trump administration explicitly rejected the MLC, casting significant doubt on the future of Amount A. The DST moratorium expired, and several jurisdictions reinstated or expanded their Digital Services Taxes.

Amount A covers multinational groups that exceed the following thresholds:

• Consolidated annual revenue exceeding EUR 20 billion (with a potential phase-down to EUR 10 billion)
• Global pre-tax profitability above 10% (profit/revenue ratio)
• Certain regulated financial services entities and extractives are excluded

Market jurisdictions obtain a taxing right when their revenue threshold is met and the group's residual profits are positive.

In return, participating jurisdictions committed under a DST Standstill Agreement not to introduce new Digital Services Taxes. This moratorium expired at the end of 2023.

• Consolidated group revenue > EUR 20 billion
• Global profitability > 10% pre-tax
• Revenue in market jurisdiction > EUR 1 million (EUR 250,000 for smaller economies)
• Conclusion of Multilateral Convention and domestic ratification
• Standstill/withdrawal of Digital Services Taxes as quid pro quo
• Simplified dispute resolution mechanism for allocated profits

2 corrections:
- Wrong date for Unified Approach: May 2019 is Programme of Work
- official_url uses outdated OECD URL format
5 updates:
- Missing reference to DST moratorium
- Missing key date: Programme of Work May 2019
- Missing key dates: MLC signing deadline and extensions
- Missing related link to Amount B
- history: US rejection 2025 could be more precise
4 clarifications.