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G20 approves tax crackdown and warns about virus variants – News


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July 11, 2021

G20 powers finance chiefs endorsed a groundbreaking move to prevent multinationals from moving profits to low-tax shelters at talks on Saturday, with coronavirus variants recovering the global economy It also warns you that you are threatening.

The agreement will establish a global minimum corporate tax of at least 15% to discourage multinationals from shopping at the lowest tax rates-Reuters

They also acknowledged the need to ensure fair access to vaccines in poor countries. However, the draft communiqué stamped at a conference in Venice, Italy, did not contain any concrete new suggestions on how to do it.

The tax agreement was set to be the largest new policy initiative that emerged from their consultations. It concludes the eight-year debate over tax issues, the purpose of which is for state leaders to give it a final blessing at the October G20 summit in Rome.

The agreement will establish a global minimum corporate tax of at least 15% to discourage multinational corporations from shopping at the lowest tax rates.Also, Amazon and Google Taxes are based in part on the location where the product or service is sold, not the location of the headquarters.

Germany’s Treasury Minister Janet Yellen has confirmed to reporters that all G20 economies are participating in the deal, while U.S. Treasury Secretary Janet Yellen is still opposed to low-tax Ireland and Hungary. He said he would encourage a small number of countries to sign. By October.
“We are trying to do that, but we must emphasize that it is not mandatory for all countries to participate,” she said.

“This agreement contains a kind of enforcement mechanism that can be used to prevent holdout countries from using tax havens that undermine the operation of this global agreement. . “

G20 members make up more than 80% of the world’s gross domestic product, 75% of world trade and 60% of the planet’s population. This includes big names in the US, Japan, UK, France, Germany and India.

In addition to the European Union holdouts of Ireland, Estonia and Hungary, other unsigned countries include Kenya, Nigeria, Sri Lanka, Barbados, St. Vincent and the Grenadines.

Among other issues, President Joe Biden’s plan to raise taxes on companies and wealthy Americans in the U.S. Congress, like another EU plan for digital taxation on high-tech companies, raises issues. There is a possibility.

U.S. Treasury officials say EU plans are inconsistent with broader global transactions, even though taxation is primarily targeted at European companies.

2-track recovery

Beyond tax agreements, the G20 addresses concerns that the rapid rise of deltacoronavirus variants, coupled with unequal access to vaccines, poses a risk to the recovery of the global economy.

Citing improvements in the global outlook to date, the draft adds: Of vaccination. “

According to a new Reuters COVID-19 infection count, infections are increasing in 69 countries, and the daily infection rate has been on the rise since late June, reaching 478,000 today.

“We all have to improve vaccination performance anywhere in the world,” France’s Treasury Minister Bruno Le Marie told reporters. “We have very good economic forecasts for the G20 economy, and the single hurdle on the road to a quick and solid economic recovery is the risk of having a new wave.”

The world is facing a “deteriorating two-track recovery,” partly due to differences in vaccine availability, said IMF Managing Director Cristalina Georgieva.

“It’s an important moment calling for urgent action by the G20 and policy makers around the world,” she said in a complaint made in preparation for the meeting.

Communiqué emphasized its support for “fair global sharing” of vaccines, but did not propose concrete new measures, and the IMF, the World Bank, the World Health Organization, and the World Trade Organization provided a new $ 50 billion vaccine loan. I just accepted the recommendation.

The IMF is also urging G20 countries to determine a clear path for developed countries to donate about $ 100 billion worth of newly issued IMF reserves to poor countries.

Geoffrey Okamoto, IMF’s first deputy managing director, told Reuters that by the end of August, a new $ 650 billion allocation was completed for countries in need of newly issued special drawing rights. He said his goal was to be able to present possible options.

© Thomson Reuters 2021 All rights reserved.

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