BEPS 2.0 and the 15% global minimum tax: what it means for expatriates in Paraguay in 2026

It's the specter that has haunted all tax expatriates since 2021: the 15% global minimum tax. Under the impetus of the OECD and the G20, 140+ countries have agreed to impose a minimum tax rate of 15% on large multinational corporations. The media headlined "the end of tax havens," politicians celebrated "global tax justice," and expatriates in Paraguay panicked: is the 0% on my foreign income threatened?

The short answer is no—not in 2026, and probably not for a long time for individuals. But the subject is complex and misunderstood enough to warrant a comprehensive guide. This guide explains what BEPS 2.0 is, how the global minimum tax works, who is actually affected, what it changes (and doesn't change) for an expatriate in Paraguay, and what evolutionary scenarios to monitor.

BEPS: What exactly are we talking about?

The origin of the project

BEPS stands for Base Erosion and Profit Shifting. It is a project launched by the OECD in 2013, at the request of the G20, to combat tax optimization strategies used by multinational corporations to reduce their tax burden:

• The problem: companies like Apple, Google, Amazon, and Starbucks used complex structures (Double Irish, Dutch Sandwich, Luxembourg patent box) to shift their profits to low-tax jurisdictions—reducing their effective tax rate to 2-5% while the nominal rate in the countries where they operated was 25-35%.
• The scale: the OECD estimated that tax erosion related to BEPS represented 100-240 billion USD/year in lost tax revenues for states—i.e., 4-10% of total corporate tax revenues.
• The response: the initial BEPS project (2013-2015) produced 15 "Actions" (recommendations) to plug the loopholes. Then came BEPS 2.0—the more ambitious second phase, with the famous global minimum tax.

BEPS 1.0 vs BEPS 2.0

Aspect	BEPS 1.0 (2013-2015)	BEPS 2.0 (2021-2026+)
Focus	Plugging existing loopholes (transfer pricing, treaty abuse, hybrid structures)	Deeply reforming the international tax system
Mechanism	15 Actions (recommendations, soft law)	2 binding Pillars (multilateral treaty)
Target	All multinationals	Pillar 1: the largest (revenue > €20 billion). Pillar 2: large (revenue > €750 million).
Impact on individuals	Indirect (transparency, information exchange)	No direct impact in 2026—but future potential

The two pillars of BEPS 2.0

Pillar 1: Reallocation of taxing rights

Pillar 1 aims to reallocate a portion of the profits of very large multinational corporations (revenue > €20 billion and profit margin > 10%) to the countries where they make their sales (the "market jurisdictions"), even if they do not have a physical presence there:

• Principle: 25% of residual profit (beyond a 10% margin) is reallocated to market jurisdictions proportionally to the revenue generated in each country.
• Target: approximately 100 multinational corporations worldwide (the largest: Apple, Microsoft, Google, Amazon, LVMH, Nestlé, etc.).
• Status in 2026: Pillar 1 is still under negotiation. The Multilateral Convention (MLC) has not yet been signed by all countries. The USA is blocking on several points. Entry into force is postponed to 2027 at the earliest—and some experts doubt it will ever enter into force in its current form.
• Impact for expatriates in Paraguay: none. Pillar 1 only concerns multinational corporations with over €20 billion in revenue. No freelancers, entrepreneurs, or individual investors are affected. Even the most prosperous SMEs are far from the threshold.

Pillar 2: The 15% global minimum tax (GloBE)

This is the pillar everyone is talking about. Pillar 2—also called GloBE (Global Anti-Base Erosion)—establishes an effective minimum tax rate of 15% for large multinational corporations:

• Threshold: multinational groups with consolidated revenue exceeding €750 million.
• Mechanism: if a subsidiary of the group is taxed at an effective rate below 15% in a country, the parent company's country can levy a "top-up tax" to bring the effective rate to 15%. If the parent company's country does not do so, another country in the group can (the "UTPR"—Undertaxed Payment Rule mechanism).
• Status in 2026: Pillar 2 is more advanced than Pillar 1. The EU has adopted an implementing directive (December 2022). The United Kingdom, Japan, Korea, Canada, and Australia have also legislated. Most major jurisdictions apply or will apply Pillar 2 by 2026-2027. The USA has NOT adopted Pillar 2 (Congress is blocking it) but has a similar mechanism (GILTI—Global Intangible Low-Taxed Income, at a rate of 10.5-13.125%).

How Pillar 2 works in practice

Let's take a simplified example:

Entity	Country	Profit	Tax paid locally	Effective rate	Pillar 2 top-up
Parent company	France	€500 M	€125 M (CIT 25%)	25%	€0 (rate > 15%)
Production subsidiary	Germany	€200 M	€60 M (CIT ~30%)	30%	€0 (rate > 15%)
IP subsidiary (intellectual property)	Ireland	€300 M	€37.5 M (CIT 12.5%)	12.5%	€7.5 M (top-up to reach 15% = 2.5% × €300 M)
Holding subsidiary	Luxembourg	€100 M	€5 M (effective rate 5% via special regimes)	5%	€10 M (top-up to reach 15% = 10% × €100 M)

The total top-up tax is €17.5 M—levied by France (the parent company's country) on the undertaxed profits of the Irish and Luxembourg subsidiaries. The group's overall effective rate rises from ~20.7% to ~22.3%.

The key point: this mechanism applies only to multinational groups with €750+ M in revenue. Not to individuals. Not to freelancers. Not to SMEs. Not to US LLCs with €200,000/year in revenue.

What BEPS 2.0 changes for expatriates in Paraguay: nothing (in 2026)

Why you are NOT affected

Pillar 2 (the 15% global minimum tax) only concerns multinational groups with consolidated revenue exceeding €750 million. To be clear:

• Your US LLC that bills €200,000/year: not affected. The threshold is 750 MILLION, not 750,000.
• Your Paraguayan SRL that manages 3 apartments: not affected.
• Your Interactive Brokers portfolio of €500,000: not affected (this is a personal investment, not a multinational).
• Your consulting/freelance activity at €500,000/year: not affected. Not even close to the threshold.
• Even a Paraguayan SME with €10 million in revenue: not affected.

Pillar 2 targets the Googles, Amazons, and LVMHs of this world—not freelancers, investors, or SMEs. It is a tool designed for very large multinational corporations that move billions in profits between jurisdictions. Your US LLC + Mercury Bank + Paraguay residency structure is not on BEPS 2.0's radar.

Paraguayan territoriality is NOT threatened by BEPS 2.0

Another common misunderstanding: BEPS 2.0 will "force Paraguay to tax foreign income." This is false:

• Pillar 2 does NOT require countries to adopt worldwide taxation. It requires the parent company's country of a multinational to apply a top-up tax if a subsidiary is taxed at less than 15% elsewhere. This is a mechanism between countries, applied to multinationals—not an obligation for Paraguay to amend its domestic tax law.
• Paraguay could decide to adopt a "Qualified Domestic Minimum Top-Up Tax" (QDMTT)—a local minimum tax of 15%—to capture the top-up tax before the parent company's country does. But even in this case, this QDMTT would only apply to Paraguayan subsidiaries of multinational groups with over €750 M in revenue. Not to personal US LLCs or expatriate Paraguayan SRLs.
• Paraguayan territoriality (0% on foreign income for individuals) is NOT a BEPS 2.0 issue. BEPS 2.0 deals with corporate income tax for multinationals, not personal income tax for individuals.

The real impacts of BEPS 2.0 on the global tax ecosystem

Impact 1: The end of ultra-advantageous tax regimes for multinationals

Countries that attracted multinationals with corporate tax rates below 15% must adapt:

• Ireland: the corporate tax rate was 12.5%. Ireland has increased its rate to 15% for large companies covered by Pillar 2 (while maintaining 12.5% for uncovered SMEs). Ireland remains attractive, but the differential with other countries has narrowed.
• Luxembourg: ultra-favorable patent box and holding company regimes are adjusted to achieve an effective minimum rate of 15% for covered groups.
• Singapore, Hong Kong, Switzerland: these jurisdictions are adapting their special regimes (IP box, headquarters incentives) to comply with the 15% floor.
• United Arab Emirates: the UAE introduced a 9% corporate tax in 2023 (previously 0%)—partly under BEPS pressure, even if the rate is below the 15% Pillar 2 threshold (the UAE is considering a 15% QDMTT for covered groups).

These changes concern large multinational corporations, not individuals. But they modify the landscape of international tax competition—and some countries might seize the opportunity to broaden their reforms beyond Pillar 2.

Impact 2: The potential contagion effect

The long-term risk for expatriates is not BEPS 2.0 itself—it's the contagion effect. The 15% global minimum tax for multinationals creates a political precedent and a narrative:

• "If multinationals have to pay at least 15%, why not wealthy individuals?"
• "The global minimum tax works for companies—let's extend it to individuals."
• The OECD, the EU, and certain governments (notably France) are already pushing the idea of a global minimum tax on wealthy individuals.

This is not yet a concrete project—but it is a political direction. Here are the initiatives to monitor:

• The Brazilian proposal to the G20 (2024): Brazil (G20 presidency in 2024) proposed a 2% global minimum tax on the net wealth of billionaires. The proposal was discussed but not adopted—it remains on the table.
• The EU "Taxing the Ultra-Rich" proposal: discussions in the European Parliament on a minimum tax on very high net worth individuals. Embryonic stage.
• Extension of Pillar 2 to SMEs: the €750 M threshold could be lowered in the coming years (to €250 M, then €50 M, etc.). This is a plausible scenario over 5-10 years—but it would still only concern businesses, not individuals.

Impact 3: Pressure on small territorial countries

BEPS 2.0 creates indirect pressure on countries with territorial taxation:

• EU blacklist: the EU uses its list of "non-cooperative jurisdictions" (blacklist) as a pressure tool. A country that does not cooperate with BEPS standards risks being placed on this list = economic sanctions (restrictions on financial flows, additional costs for companies trading with that country).
• Paraguay and the blacklist: Paraguay is NOT on the EU blacklist in 2026. It cooperates with the CRS, has acceded to the Multilateral Convention on Administrative Assistance, and is not considered a tax haven. Territoriality itself is not a criterion for blacklisting—what matters is cooperation on information exchange and transparency. Paraguay meets these criteria.
• Future risk: if the OECD or the EU ever decided that territoriality is a "harmful tax practice," Paraguay could face pressure to change its regime. This scenario is unlikely in the medium term (territoriality is a legitimate tax system recognized by the OECD—Hong Kong, Singapore, and Panama apply it without being on the blacklist) but not impossible in the very long term (> 10 years).

The future scenario: a global minimum tax on individuals?

The state of discussion in 2026

The idea of a global minimum tax on individuals (not just multinationals) is in the international political debate but is not a concrete project:

• The Gabriel Zucman proposal: French economist Gabriel Zucman (director of the EU Tax Observatory) proposed a 2% global minimum tax on the net wealth of billionaires. The report commissioned by the Brazilian G20 (2024) estimates that this tax could generate 200-250 billion USD/year in global revenues.
• Political support: France, Brazil, Spain, and South Africa support the idea. The USA, the United Kingdom, and Germany are more reserved. Tax havens and countries with territorial taxation are opposed.
• Obstacles: a global tax on individuals is infinitely more complex than Pillar 2 on companies. Companies have audited financial statements, identifiable legal structures, and standardized reporting obligations. Individuals have diversified assets (real estate, art, trusts, cash, crypto) that are difficult to value, less transparent structures, and constitutional rights (property rights, national sovereignty) that limit the scope of a global tax.
• Realistic timeline: even in the most optimistic scenario (for its proponents), a global minimum tax on individuals would not be operational before 2030-2035—and probably never in the form of a uniform rate applicable to all residents of all countries.

Possible forms of a minimum tax on individuals

If such a tax were to emerge, it could take several forms:

Model	Mechanism	Who would be affected	Impact on an expatriate in PY
Global wealth tax (Zucman)	2% per year on net wealth > 100 M USD	~3,000 billionaires worldwide	None (unless your wealth exceeds 100 M USD)
Minimum income tax for the ultra-rich	Minimum rate of 15-20% on income > €1-5 M/year	The very high earners (top 0.01%)	None for 99.99% of expatriates in Paraguay
Extension of Pillar 2 to individuals	The country of citizenship applies a top-up tax if the country of residence taxes at less than 15%	All expatriates living in low-tax countries	Potentially impactful—but the most improbable scenario (implication: citizenship-based taxation, like the USA)
European minimum tax on intra-EU expatriates	An EU resident who expatriates to a non-EU low-tax country is taxed a minimum by their country of origin for X years	EU expatriates	Potentially impactful but time-limited and likely capped

In most scenarios, a global minimum tax on individuals would only affect the ultra-rich (wealth > €100M or income > €1-5M/year). For an expatriate in Paraguay with an income of €100,000-€500,000/year, none of these scenarios would apply—even in the most ambitious forms of the project.

The Most Realistic Scenario (and Why It Doesn't Concern You)

The most probable scenario for 2030-2035 is a combination of targeted measures for the ultra-rich, not a universal reform:

• A minimum tax on billionaires (wealth > €100M) at a rate of 1-2%—applied in a coordinated manner by G20 countries.
• Reinforcement of national exit taxes (France is already tightening its own) to capture latent capital gains at the time of departure.
• Strengthening of information exchange (expanded CRS, CARF for crypto) to improve transparency—not to create a new tax.
• No obligation for territorial countries to modify their domestic tax regime.

In summary: BEPS 2.0 and its developments do not threaten Paraguayan territoriality or the tax situation of a "normal" French-speaking expatriate (income < €5M/year, wealth < €50M). The media narrative about "the end of tax havens" is largely exaggerated for individuals.

What Expatriates in Paraguay Should Monitor

Warning Indicators

Even if BEPS 2.0 doesn't concern you in 2026, here are the signals to watch for in the coming years:

• Lowering of Pillar 2 Threshold: If the €750M threshold is lowered to €250M, then €50M, then €10M—the trend indicates a desire to cover more and more companies. Eventually, the threshold could drop low enough to cover significant SMEs. But dropping below €10M is politically unlikely (too many SMEs affected in developed countries = massive political opposition).
• G20/OECD Discussion on a Minimum Tax for Individuals: If the subject moves from "academic discussion" to "OECD working group with mandate," that's a serious signal. In 2026, it's still at the academic stage.
• Pressure on Paraguay via the EU Blacklist: If Paraguay appears on the EU's watch (grey) or blacklist, it's a signal that international pressure on territoriality is intensifying. In 2026, Paraguay is in compliance.
• Legislative Change in Paraguay: Any Paraguayan bill aiming to modify territoriality (taxing foreign income, even partially) is an immediate warning signal. Follow the news through your Paraguayan accountant and local media (ABC Color, La Nación).
• Citizenship-Based Taxation in Europe: If a European country (France, for example) adopts a citizenship-based taxation mechanism (like the USA), French expatriates would be taxed even if they live in Paraguay. This is an extreme and politically difficult scenario (infringement on free movement for EU citizens) but not impossible.

Long-Term Protection Strategy

Even if the risks are low in the medium term, a prudent asset protection strategy is essential:

• Obtain Paraguayan Nationality: After 3 years of residency, you can obtain Paraguayan nationality (dual nationality retained). If France ever taxes based on citizenship, renouncing French nationality would become an option (extreme, but available if needed). Paraguayan nationality gives you maximum flexibility.
• Geographically Diversify Your Assets: Don't put everything in Paraguay. Distribute between the USA (Mercury, Interactive Brokers), Luxembourg (life insurance), Paraguay (real estate, SRL), and potentially Singapore or Hong Kong (investment accounts). Geographic diversification protects against the risk of legislative change in a given country.
• Build Your Wealth Quickly: The 0% territoriality window is open today. Each year at 0% is a year of maximum capitalization. Even if territoriality were to change in 10 years, the 10 years of 0% savings are acquired and definitive. No one can retroactively tax your past savings.
• Stay Informed: Follow OECD/G20 developments on international taxation. Announcements are public (OECD website, Inclusive Framework reports). Your accountant and tax lawyer should alert you to any significant changes.

Myths to Debunk

Myth 1: "The 15% global minimum tax applies to everyone."

False. It only applies to multinational groups with consolidated revenue > €750M. Not to individuals, not to SMEs, not to personal US LLCs, not to Paraguayan SRLs.

Myth 2: "Paraguay will have to tax foreign income because of BEPS."

False. BEPS 2.0 does not require countries to modify their internal tax regime for individuals. Paraguay can maintain its territoriality while complying with BEPS standards—which it does (CRS, administrative assistance, transparency).

Myth 3: "Tax havens are dead thanks to BEPS 2.0."

Partially true for multinationals, false for individuals. 0-5% corporate tax regimes for subsidiaries of multinationals are indeed disappearing (floor at 15%). But 0% regimes for individuals (territoriality, countries without income tax) are not affected by BEPS 2.0.

Myth 4: "You need to expatriate before the global minimum tax applies to individuals."

Premature. There is no concrete plan for a global minimum tax on individuals in 2026. Academic and political discussions are in their infancy. The urgency to expatriate comes from current French taxation (45% + social contributions + exceptional contribution on high incomes + LMNP reform + tightened exit tax), not from a hypothetical global minimum tax that doesn't yet exist and would probably not concern you even if it did.

Myth 5: "If I earn less than €750M but use a US LLC, I am affected by Pillar 2."

False. The threshold is the consolidated revenue of the GROUP, not of the entity. Your US LLC with €200,000 in revenue is not a "multinational group with €750M in revenue." Even if you had 10 LLCs in 10 countries, if their total revenue is less than €750M, you are not concerned.

BEPS 2.0 and Paraguay: The Official Position

Paraguay in the OECD Inclusive Framework

Paraguay is a member of the OECD Inclusive Framework on BEPS—the group of 140+ countries that negotiates and implements BEPS standards. As a member:

• Paraguay commits to respecting the minimum BEPS standards (exchange of information, combating treaty abuse, country-by-country reporting).
• Paraguay is NOT obliged to adopt Pillar 2 (it is not a minimum standard—it is a framework that countries choose to implement or not).
• In 2026, Paraguay has not announced plans to implement Pillar 2 or to modify its territoriality. The country is in compliance with existing standards and is not subject to any specific pressure from the OECD.

Why Paraguay is Not Under Pressure

• No Concerned Multinationals: Paraguay does not host headquarters of multinationals with €750M+ in revenue. Pillar 2 has no "target" in Paraguay—there is no taxable base to protect.
• CRS Cooperation: Paraguay automatically exchanges banking information = transparent in the eyes of the OECD.
• Multilateral Convention on Administrative Assistance: Paraguay has adhered to it = cooperation in international tax control.
• Not on Blacklists: Neither EU nor FATF. Paraguay is a cooperative country in international standards.

Paraguay does what the OECD asks (transparency, cooperation, information exchange) without doing what the OECD does NOT ask (taxing foreign income of individuals). This is the ideal position: compliant and territorial at the same time.

Conclusion

BEPS 2.0 and the 15% global minimum tax are major reforms of international taxation—but they do NOT concern expatriates in Paraguay in 2026. Pillar 2 applies to multinational groups with €750M+ in revenue, not to freelancers, entrepreneurs, investors, or retirees. Paraguayan territoriality is not threatened by BEPS 2.0. Your foreign income remains at 0%.

Future risks (minimum tax on wealthy individuals, extension of Pillar 2, pressure on territorial countries) exist but are 5-15 years away, would probably only concern the ultra-rich (wealth > €100M), and would not affect the vast majority of expatriates. The protection strategy is simple: obtain Paraguayan nationality (3 years), geographically diversify your assets, capitalize quickly while the window is open, and stay informed.

The media narrative about "the end of tax havens" sells newspapers but does not correspond to the reality for individuals in 2026. Multinationals with €750M+ in revenue are concerned. You, with your US LLC, your Mercury Bank, and your apartment in Villa Morra—you are not. Paraguay remains in 2026 what it has always been: a country with pure territoriality, compliant with international standards, and accessible from €1,400.

Do you want to take advantage of territoriality while it's at 0%? Contact our team to start your Paraguayan tax residency (from €1,400). US LLC, bank account, accounting (€30/month). The 15% global minimum tax does not concern you—but the 45% French tax concerns you every day you remain a French resident.