One of the key outcomes of the G20 meeting that’s just taken place in Rome is progress on the agreement for a much-heralded ‘global minimum corporate tax’. This is being seen by many as a great step forward in curtailing the activities of the largest multinationals, in organising their affairs so as to avoid the vast bulk of taxes they’d otherwise be liable for in the countries where they carry on their activities. Good news? Well, maybe. It’s undoubtedly great news that corporate tax avoidance is attracting scrutiny – enabling wealthy shareholders to benefit at the expense of the nations whose infrastructure, workforce or consumer base their companies profit from. But as with anything, there are winners and losers – and predictably, it’s the richer, more powerful nations that are doing best. Indeed many less-wealthy countries are unenthusiastic about signing up to any such deal, pointing to the fact that for them, the deal locks in far lower benefits than it does for the US, for example. And all this, in the shadow of the COP26 on climate change – where nations will be negotiating on the extent to which they can mitigate and adapt to climate challenges, and for which poorer countries may struggle to find the funding unless they get a fairer share of the ‘tax take’. We’re keeping these discussions in our prayers – and hoping for wisdom and goodwill for all those taking part in negotiations.
Global Corporate Minimum Tax Rate – CATJ Comments
