The agreement seemed clear and only the fringes were missing to be finalized. Finally, this Saturday the Ministers of Economy of the Group of Seven (G7) have agreed to apply a minimum corporate tax of 15% for large companies.
This has been announced by the head of the British Economy, Rishi Sunak, who sees in the pact “a fairer system” that allows “to collect more taxes to pay for public services.
???? At the in London today, my finance counterparts and I have come to a historic agreement on global tax reform requiring the largest multinational tech giants to pay their fair share of tax in the UK.
????The thread below explains exactly what this means.
— Rishi Sunak (@RishiSunak)
“We are committed to reaching an equitable solution on the distribution of taxing rights, granting market countries taxing rights on at least 20% of profits exceeding a margin of 10% for the largest multinational companies and profitable,” says the text of the agreement.
The objective is to prevent large multinationals from relocating their headquarters to another country where they have much more favorable tax treatment, in addition to making them pay in the countries where they operate.
The 15% figure, while above the level of countries like Ireland, is below the lowest level of the G7. However, it is a first move to involve more international actors.
The US Secretary of the Economy and former Governor of the Federal Reserve, Janet Yellen, has indicated that this global minimum tax will end the tax race “and guarantee fairness for the middle class and working people in the US and the rest of the world”.
However, the agreement does not include any reference to the big technology companies, something in which the United States continues to confront European countries that defend the implementation of the so-called Google Tax. In fact, the North American country has punished this week with , for this issue.
On the other hand, the Seven – the US, Japan, Germany, Great Britain, France, Italy and Canada – have committed to integrating climate change and biodiversity into decision-making and will create a working group to prosecute environmental crimes.
They have also stated that they will move towards a standard model for companies to declare their environmental impact, facilitating comparison for investors seeking to reward sustainability.
In addition, Sunak has announced that the proposal will also be taken to the G20, where it will be discussed at the meeting next July in Venice.
The President of the Spanish Government, Pedro Sánchez, has celebrated the agreement on his Twitter account, highlighting that it goes in the direction of “a better distribution of wealth to achieve greater levels of social justice”.
We are moving towards a new tax system for the global digital age. He reaches today a historic agreement that will allow a greater contribution of great world companies. The goal: a better distribution of wealth to achieve higher levels of social justice.
– Pedro Sánchez (@sanchezcastejon)
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