Thursday, September 16, 2021
Home Business G7 nations reach historic deal to tax big multinationals By Reuters

G7 nations reach historic deal to tax big multinationals By Reuters


© Reuters. FILE PHOTO: Britain’s Chancellor of the Exchequer Rishi Sunak speaks at a meeting of finance ministers from across the G7 nations ahead of the G7 leaders’ summit, at Lancaster House in London, Britain June 4, 2021. Stefan Rousseau/PA Wire/Pool via REUTERS

By David Milliken and Kate Holton

LONDON (Reuters) – A group of the world’s richest nations reached a landmark deal on Saturday to close cross-border tax loopholes used by some of the world’s biggest companies.

The Group of Seven said it would back a minimum global corporation tax rate of at least 15%, and put in place measures to ensure taxes were paid in the countries where businesses operate.

“After years of discussion, G7 finance ministers have reached a historic agreement to reform the global tax system to make it fit for the global digital age,” British finance minister Rishi Sunak told reporters.

The accord, which could form the basis of a global pact next month, is aimed at ending a decades-long “race to the bottom” in which countries have competed to attract corporate giants with ultra-low tax rates and exemptions.

That has in turn cost their public coffers hundreds of billions of dollars – a shortfall they now need to recoup all the more urgently to pay for the huge cost of propping up economies ravaged by the coronavirus crisis.

Ministers met face-to-face in London for the first time since the start of the COVID-19 pandemic.

According to a copy of the final agreement seen by Reuters, the G7 ministers said they would “commit to a global minimum tax of at least 15% on a country by country basis”.

“We commit to reaching an equitable solution on the allocation of taxing rights, with market countries awarded taxing rights on at least 20% of profit exceeding a 10% margin for the largest and most profitable multinational enterprises,” the text added.

The ministers also agreed to move towards making companies declare their environmental impact in a more standard way so investors can decided more easily whether to fund them, a key goal for Britain.

Rich nations have struggled for years to agree a way to raise more revenue from large multinationals such as Google (NASDAQ:), Amazon (NASDAQ:) and Facebook (NASDAQ:), which often book profits in jurisdictions where they pay little or no tax.

U.S. President Joe Biden’s administration gave the stalled talks fresh impetus by proposing a minimum global corporation tax rate of 15%, above the level in countries such as Ireland but below the lowest level in the G7.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





Source link

RELATED ARTICLES

Defense expert on aggressive China, U.S.-U.K.-Australia security pact

An increasingly aggressive and assertive China contributed to the formation of a new trilateral security partnership among the U.S., the U.K. and Australia,...

Two-week deadline: Supreme Court slams govt for ‘cherry-picking’ names for tribunal appointments

“We are a democratic country. You have to follow the rule of law,” the CJI said said, while warning the government of initiating...

Canadian Pacific clinches $27-billion Kansas City Southern deal as rival bows out By Reuters

© Reuters. FILE PHOTO: A Canadian National Railway train travels westward on a track in Montreal, February 15, 2015. REUTERS/Christinne Muschi/File Photo By Greg...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Defense expert on aggressive China, U.S.-U.K.-Australia security pact

An increasingly aggressive and assertive China contributed to the formation of a new trilateral security partnership among the U.S., the U.K. and Australia,...

Two-week deadline: Supreme Court slams govt for ‘cherry-picking’ names for tribunal appointments

“We are a democratic country. You have to follow the rule of law,” the CJI said said, while warning the government of initiating...

Canadian Pacific clinches $27-billion Kansas City Southern deal as rival bows out By Reuters

© Reuters. FILE PHOTO: A Canadian National Railway train travels westward on a track in Montreal, February 15, 2015. REUTERS/Christinne Muschi/File Photo By Greg...

bond default, risks for investors

The Emerald Bay residential project developed by China Evergrande in the Tuen Mun district of the New Territories in Hong Kong, China, on...

Recent Comments