One of the richest countries in the world agrees on a minimum global corporate tax rate to close the cross-border tax gaps used by some companies.
The finance ministers of the seven (G7) richest countries reached a significant agreement on Saturday to support the creation of a global minimum corporate tax rate of at least 15 percent in a bid to close the cross-border tax gaps used by some corporations.
“We owe it to ourselves to impose a global minimum tax of at least 15 per cent on a country-by-country basis,” the G7 said in a statement following their meeting in London.
Large economies aim to encourage profits of multinational corporations տեղափոխ transfer tax revenues to low tax countries, regardless of where they are sold.
More and more intangible income, such as drug licenses, software, and intellectual property royalties, has shifted to those powers, allowing companies to avoid paying higher taxes in their home countries.
The G7 agreement is part of a much broader, existing effort. For years, the Organization for Economic Co-operation and Development (OECD) has been coordinating tax negotiations between 140 countries on rules for taxing cross-border digital services and preventing tax base erosion, including the global corporate minimum tax.
The G7 hopes to reach a final agreement at the G20 enlarged finance ministers’ meeting in July. If a broad consensus is reached, it will be extremely difficult for any low-income country to try to block the agreement.
“I am pleased to announce that the G7 finance ministers … have reached a historic agreement to reform the global tax system,” said Richie Sunak, the UK Treasury Secretary who personally chaired the two-day talks following the easing of COVID-19 restrictions. ,
It was attended by partners from Canada, France, Germany, Italy, Japan, Aponia and the United States.
Sunak noted that the G7 has agreed to make the global tax system “relevant to the global digital age – to make sure it is fair for the right companies to pay the right places in the right places.”
He thanked his colleagues for “concluding a historic deal that finally brings our global tax system into the 21st century.”
The significant step is aimed at forcing multinational companies, especially technology giants, to pay more to the state treasury, which was severely damaged during the epidemic.
The talks paved the way for a wider G7 summit in Cornwall, south-west of England, on Friday.
US President Biden is set to attend next week’s summit on his first foreign tour since taking office in January, with US Treasury Secretary Annette Yellen holding a press conference after the G7 summit on Saturday.