China's large multinational companies need to prepare for new corporate tax rules proposed by the world's leading economies, experts said.

On Thursday, 130 countries and jurisdictions, including China, which represent about 90 percent of the global economy, agreed to a global tax reform plan that proposed, among other things, a global minimum corporate tax rate of at least 15 percent.

The new global corporate tax initiative was piloted by the Organization for Economic Cooperation and Development and the G20, with an aim to deal with tax challenges like evasion and avoidance arising from the digitalized global economy.

Final agreement on the plan is expected in October and the new tax regime may take effect in 2023, subject to each country or jurisdiction in enacting relevant laws.

So, Chinese MNCs should begin preparing for the future in right earnest, so as to be able to perform better in the digital era, experts said.

Large MNCs, especially the so-called Big Tech companies, will likely be affected by the new tax proposals. That apart, costs of noncompliance, tax avoidance or evasion in the new system may also rise, experts said.

In China, the corporate tax rate applicable to general businesses is 25 percent, while that for high-tech companies is 15 percent.

At the beginning of 2021, the minimum corporate tax rate globally on average was between 10 percent and 12.5 percent.

"In the short term, the impact of the new global corporate tax rate, whenever it is implemented, on China will likely be relatively limited," said Li Xuhong, director of the Institute of Finance and Taxation Policy and Application, which is part of the Beijing National Accounting Institute. "But it will have a greater impact on enterprises that invest in low-tax areas."

Li, however, clarified that low tax rates are not the only factor that draw companies' investments or influence their decision to set up their global or regional headquarters in certain places. Typically, companies are also swayed by perceived advantages in market environment, labor, capital, land and other factors.

China, being the world's largest consumer market, offers tremendous advantages in even non-tax issues, and hence figures among the preferred destinations of foreign investors.

And when the proposed minimum global tax rate takes effect, China's attractiveness may well become enhanced, she said.

The proposed new rules are expected to help end the unhealthy competition among countries, particularly tax havens like certain islands, to lower corporate tax rates or offer tax incentives to attract foreign investments, which end up hurting tax revenues of some other economies.

Once the new tax regime kicks in, tax havens will no longer be able to thrive at the expense of other economies.

"After years of intense work and negotiations, this historic package will ensure that large multinational companies pay their fair share of tax everywhere," OECD Secretary-General Mathias Cormann said. "This package does not eliminate tax competition, as it should not, but it does set multilaterally agreed limitations on it."

A significant part of the new rules, which is called the "Pillar Two", requires a minimum tax rate of 15 percent on MNCs with revenue of 750 million euros ($890 million) or more, according to an OECD document.

The other part of the new tax reform plan, or the "Pillar One", targets the world's largest MNCs with at least 20 billion euros in consolidated revenue. The threshold may be reduced to 10 billion euros after a seven-year period and a review, it said.

The Pillar One gives the taxing rights to jurisdictions that represent MNCs' major consumer markets or the bases where they earn a large share of their global profits, regardless of whether companies have headquarters or a physical presence, said a research note from Deloitte, a provider of professional services for corporate clients.

The OECD indicated that the rules for both pillars are intended to be drafted in 2022, with the majority of those rules likely to take effect in 2023.