LONDON: The United States, Britain and other leading nations reached a landmark deal on Saturday to pursue higher global taxation on multinational businesses such as Google, Facebook, Apple and Amazon.
In a move that could raise hundreds of billions of dollars to help governments cope with the aftermath of COVID-19, the Group of Seven (G7) large advanced economies agreed to back a minimum global corporate tax rate of at least 15 percent. Companies will also have to pay more tax in the countries where they make sales.
“G7 finance ministers have reached a historic agreement to reform the global tax system to make it fit for the global digital age,” British finance minister Rishi Sunak said after chairing a two-day meeting in London.
The meeting, hosted at an ornate 19th-century mansion near Buckingham Palace in central London, was the first time finance ministers have met face-to-face since the start of the pandemic.
US Treasury Secretary Janet Yellen said the “significant, unprecedented commitment” would end what she called a race to the bottom on global taxation.
German Finance Minister Olaf Scholz said the deal was “bad news for tax havens around the world,” adding: “Companies will no longer be in a position to dodge their tax obligations by booking their profits in the lowest-tax countries.”
Rich nations have struggled for years to agree a way to raise more revenue from large multinationals, which can pay little tax on the billions of dollars of…
