BRUSSELS, (Reuters) – The European Commission has proposed a law Wednesday to implement in Europe a deal reached among 20 major world economies (G20), on a minimal tax rate for businesses.

A common set of guidelines is included in the Commission’s proposal for how to calculate the global agreed 15% effective tax rates, which will be uniformly applied throughout the EU.

Paolo Gentiloni (EU Economic Commissioner) stated at a press conference that “137 countries supported the historic multilateral agreement to transform global corporate taxesation” in October.

He stated that “the directive that we have proposed will make sure that the 15% effective minimum tax rate for large corporations will be applied in an application that is completely compatible with EU law.”

Gentiloni indicated that the Commission would propose a third law to be passed in 2022, which will implement part of the OECD-G20 agreements on tax reallocation.

Any company with combined revenues exceeding 750 millions euros per year in the EU will be subject to the EU’s minimum corporate tax law.

The Commission stated that companies can exclude income up to 5% from the tangible asset value and 5% from payroll to reduce their impact on real economic activity groups.

There will be a 10 year transition period during which the exclusions are higher. They will start at 10% of gross payroll and 8% tangible assets. This will slowly decline each year.

All EU countries will need to consent to the law’s entry into force. It will also have to be discussed with the European Parliament.