|
The
Organization for Economic Cooperation and Development (OECD) has
been coordinating negotiations among 140 countries for years on
rules for taxing cross-border digital services and curbing tax
base erosion. A global corporate minimum tax is one of the major
tools under consideration.
Finance ministers from the Group of Seven (G7) rich nations
reached a landmark accord last week backing the creation of a
global minimum corporate tax rate of at least 15%, a deal that
could then form the basis of a worldwide accord.
Orban said his government opposed the move as it went against
efforts to attract foreign investment with low taxes.
Hungary's 9% corporate tax rate is among the lowest in the
27-member European Union and has used it to attract major
investments in its car and manufacturing sectors that have
lifted economic growth and employment, helping the conservative
nationalist Orban hone an image of strong economic management.
"I consider it absurd that any world organisation should assert
the right to say what taxes Hungary can levy and what taxes it
cannot," said Orban, who faces his first competitive election
next year after a string of landslide victories since 2010.
"Especially as we are not a tax haven, because the low Hungarian
corporate tax rate is not meant to attract certain companies to
declare their taxes here," he told a business conference.
Orban said Hungary's corporate tax policy has helped lure real
investments and create jobs in the central European country of
10 million people, which relies heavily on foreign investment
and European Union funds to drive economic growth.
He said his government would need to draw up contingency plans
if the tax plan does go through. This would ensure that
companies falling under its scope in Hungary need not pay higher
taxes overall as that would lead to job losses.
Hungarian Finance Minister Mihaly Varga said the global tax
could affect 2,000 to 3,000 major companies in Hungary.
Ireland, another EU member with a low corporate tax rate, also
opposes the global minimum levy idea and has embarked on a
damage limitation exercise it hopes will let it and other
low-tax economies retain some of their decades-old advantages.
(Reporting by Gergely Szakacs; Editing by Mark Heinrich)
[© 2021 Thomson Reuters. All rights
reserved.] Copyright 2021 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
