G7: tax authorities and multinationals, “historic” agreement for a common taxation of at least 15%

MILANO – The optimism of the eve is confirmed at the G7 in London, where the finance ministers meet with the big names in economic and fiscal matters: the first ‘face-to-face’ appointment since the pandemic. The British Rishi Sunak, landlord, was the first to report to Reuters a “historic” agreement on the taxation of multinationals, a “first step that needs further progress in the G20” and that will create a “common ground” in taxation for all global companies.

The commitment concerns the adoption of a minimum global rate of 15% such as corporate tax, the corporate profit tax, which according to Sunak will help fight “tax havens” and also address the issue of taxation of digital giants: “Once there is a global solution” on taxation on the profits of multinationals as a whole, the need for taxation will disappear to this for the giants of the Web.

The British Treasury then detailed on social media accounts that the G7 ministers (USA, Japan, Germany, France, United Kingdom, Italy and Canada) have reached an agreement “on the principle of a minimum global rate of 15% for the taxation of large companies, applied country by country “. This part of the agreement, which traces what is proposed by the US, contrasts with the” tightening on tax avoidance “that will make people pay “fair share” to Big Tech multinationals. According to the Treasury, “the largest global companies, with profit margins of at least 10%, will see 20% of all profits above this threshold reallocated and taxed in the countries where they make sales”.

In the Bloomberg chart, the red line represents a global taxation of 15% on multinationals (according to the US proposal gliding on the OECD table) in relation (blue bars) to the situation country by country

The reactions of the protagonists of the discussions began very soon. “Here we are. After 4 years of battle a
a historic agreement was found with the G7 member states on the minimum corporate tax on companies and digital giants. France can be proud, “said the transalpine minister Bruno the Mayor. And US Treasury Secretary Janet Yellen spoke of “an unprecedented commitment that will put an end to the race to the bottom in corporate taxation, ensuring equity for workers in the United States and around the world.”

Meetings are also present Daniele Franco for Italy e Paolo Gentiloni for the European Commission. The latter remarked that “it was a very positive meeting that allowed us to build bridges on crucial issues. The chances of a global agreement have greatly increased. Now we have to go the last mile to expand this consensus to all members of the G20 and all the countries involved in the OECD inclusive framework “, said Gentiloni. “The Commission will actively contribute to these ongoing multilateral discussions to ensure that an ambitious agreement is reached in July”, added the EU Commissioner.

The German finance owner, Olaf Scholzhe reiterated the term “historic” and added that companies will no longer be able to evade taxes by making profits in low-tax countries. Furthermore, the next step for Scholz will be to discuss the G7 agreement with a broader set of partners from the Organization for Economic Co-operation and Development and the G20. Involving China and Russia is the main goal. “The G7 decision on international tax justice is historic,” he said. “This is great news for tax justice and solidarity and bad news for tax havens around the world.”

Fisco, here’s how much EU countries would collect from a global tax on multinationals: for Italy at least 2.7 billion

01 June 2021

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