G20 to approve global corporate minimum tax deal: report
“After many years of discussions and on the basis of the progress made last year, we have reached a historic agreement on a new fair and stable international tax architecture,” the project says.
He made no mention of a specific rate for a global minimum corporate tax or other key details, which have yet to be agreed by nearly 140 countries known as the inclusive framework meeting online this week. next in talks organized by the Organization for Economic Cooperation and Development.
Details agreed at that meeting will then be sent to finance ministers and central bank governors of the world’s 20 largest economies (G20) for approval at the July 9-10 meeting in Venice.
“We endorse the core elements of the two pillars on Multinational Profit Reallocation and the Global Minimum Tax, as set out in the statement issued by the G20 / OECD Inclusive Framework on Base Erosion. Taxation and Profit Shifting (BEPS), ”the G20 project said ahead of next week’s talks.
The first “pillar” of the OECD agreement is to ensure that international companies, in particular digital giants like Google, Amazon, Facebook, Apple or Microsoft, pay taxes in the countries where they make a profit, rather than in low-tax jurisdictions chosen to minimize tax payments.
The second “pillar” is a minimum level of corporate tax globally so that governments do not compete with each other by lowering taxes to attract investment from large multinationals.
G7 finance ministers earlier this month backed a global minimum tax rate of at least 15% and thresholds to divide governments’ rights to tax profits from cross-border trade, but the G20 plan does not makes no reference to that number.
“We call on the inclusive G20 / OECD framework on BEPS to quickly finalize the remaining technical work with a view to approving the framework for implementing the two pillars by our next meeting in October,” the draft says, seen by Reuters. .
CLIMATE AND CLEAN ENERGY
Intense bilateral discussions are currently underway ahead of talks organized by the OECD to put countries on the same wavelength in the face of strong resistance from low-tax countries, including Ireland, the Netherlands, Hungary and Luxembourg.
The G20 project also supported G7 efforts to force banks and businesses to disclose their exposure to climate-related risks:
“Quality data and consistent disclosure frameworks are essential to address climate-related financial risks and mobilize sustainable finance,” the G20 project said.
“We recognize that a more comprehensive assessment of macroeconomic risks related to the environment and climate can help develop innovative solutions to make our economies more sustainable, resilient and inclusive,” he said.
The G20 will also agree to invest in sustainable infrastructure and new technologies for clean energy sources “including phasing out inefficient fossil fuel subsidies and other carbon pricing mechanisms,” the project says.
The draft also confirms the April G20 agreement to fight protectionism and “encourage concerted efforts to reform the World Trade Organization”.