|
Nearly 140 countries agreed on Friday to extend talks after the
pandemic outbreak and U.S. hesitation before the presidential
election squashed hopes of reaching a deal this year.
Public pressure is growing on big, profitable multinationals to
pay their share under international tax rules after the COVID-19
pandemic strained national budgets, the countries said in an
agreed statement.
The aim is update international tax rules for the age of digital
commerce, in particular to discourage big Internet companies
like Google <GOOGL.O>, Facebook<FB.O> and Amazon <AMZN.O> from
booking profits in low-tax countries like Ireland regardless
where their customers are.
In the absence of a new international rulebook, a growing number
of governments are planning their own digital services taxes,
which has prompted threats of trade retaliation from the Trump
administration.
"In the 'worst-case' scenario, these disputes could reduce
global GDP by more than 1%," the OECD, which has been steering
the global tax talks, estimated in an impact assessment.
Inversely, new rules for digital taxation and a proposed global
minimum tax would increase global corporate income tax worldwide
1.9% to 3.2%, or about $50 billion to $80 billion per year.
That could reach $100 billion when including an existing U.S.
minimum tax on overseas profits, amounting to 4% of global
corporate income tax, the OECD said. Meanwhile, any drag on
global growth would be no more than 0.1% in the long term
While countries agreed on OECD blueprints for a future deal, the
key remaining issue to be solved was the scope of businesses to
be covered, which would then make it easier to agree the
technical parameters, OECD head of tax Pascal Saint-Amans said.
(Reporting by Leigh Thomas, editing by Larry King)
[© 2020 Thomson Reuters. All rights
reserved.] Copyright 2020 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
