Day: 29 July 2026

Monaco has taken another step towards aligning its corporate tax framework with international standards, tabling legislation that would introduce a domestic minimum tax for the world’s largest multinational companies while ensuring the resulting tax revenue remains within the Principality.

In a statement issued Wednesday, the Government indicated that it has submitted a draft law to the National Council that would implement the OECD’s Pillar Two framework through a Qualified Domestic Minimum Top-up Tax (QDMTT), applying to multinational groups with annual consolidated revenues exceeding €750 million.

The proposed measure would ensure these companies pay an effective minimum tax rate of 15% on their activities in Monaco, in line with rules developed by the Organisation for Economic Co-operation and Development (OECD) under its Base Erosion and Profit Shifting (BEPS) initiative.

Protecting Monaco’s tax sovereignty

The government said the reform is primarily aimed at protecting Monaco’s tax revenues rather than increasing the tax burden on affected businesses.

Under the OECD’s global minimum tax framework, if Monaco does not collect the top-up tax itself, other participating jurisdictions where a multinational group has subsidiaries or a parent company could claim those revenues instead.

By introducing the domestic tax, Monaco ensures that tax generated by economic activity within the Principality remains in Monaco rather than being transferred to foreign tax authorities.

Supporting competitiveness

The government also argues that adopting an OECD-recognised framework will strengthen Monaco’s attractiveness for multinational businesses.

For companies covered by the rules, operating within a jurisdiction that complies with the OECD framework should reduce administrative complexity and avoid additional compliance obligations that could otherwise arise if Monaco did not implement the measure.

Part of wider international commitments

The reform forms part of Monaco’s ongoing efforts to align its legal and fiscal framework with international standards on tax transparency and fair taxation.

According to the government, the legislation demonstrates the Principality’s commitment to maintaining a competitive business environment while meeting the evolving requirements established by the OECD.

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Photo of the Prince’s Palace by Cassandra Tanti 

Turnover in Monaco’s construction sector fell by more than a third in 2025, a decline of close to €1 billion, as the major projects that had powered three exceptional years drew to a close, according to the latest report from the Principality’s statistics institute, IMSEE.

The sector’s revenue dropped 36.1% to €1.75 billion, a fall that accounted for more than half of the €1.6 billion (7.6%) decline in Monaco’s total revenue for the year, excluding financial and insurance activities. Even after the contraction, construction turnover remained slightly above its 2021 level and has almost doubled over the past decade, having peaked at €2.7 billion in 2024.

A near-billion-euro fall in turnover

Every part of the sector lost ground. Residential and non-residential building construction, its largest component, fell back below the €1 billion mark with a drop of €771.7 million, or 45.5%. Specialised construction works, covering the second-fix and finishing trades, declined by €157.2 million, or 16.8%, while civil engineering contracted by €57.7 million, more than halving at 55.1%.

The retreat has reshaped the sector. Building construction, which had climbed to 64.9% of turnover in 2022, now accounts for 52.8%, closely followed by specialised works on 44.5%, or €778.0 million.

Still one of Monaco’s biggest employers

Despite the downturn, construction remains one of the Principality’s largest employers. It counted 6,245 salaried staff at the end of 2025, down 288, or 4.4% — a sharper fall than the 1.2% recorded across Monaco’s private sector as a whole — yet it stayed the third-biggest employer, accounting for more than one private-sector worker in ten before temporary staff are counted. The number of employers slipped to 347, seventeen fewer than in 2024.

The count of businesses held steadier. Eighteen were created and fifteen struck off during the year, leaving 450 active establishments, a net gain of three. Specialised construction firms make up just over 70% of them.

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Photo by Cassandra Tanti