Leaders have expressed “broad support” for a landmark deal to establish a 15% global minimum corporate tax that aims at deterring multinational countries from using clever accounting to elude taxes by using low-rate havens.
Leaders spoke on the proposal during the opening session Saturday of the summit, said officials from host country Italy. Following formal approval to be reflected in Sunday’s closing statement, countries would enact the minimum tax on their own. The idea is that headquarters countries would raise a company’s tax to 15% if the firm’s profits went undertaxed in another country.
In today’s digital and global economy, profits can come from intangibles such as copyrights and trademarks and can be easily shifted to countries offering near-zero taxes in hopes of attracting revenue they otherwise wouldn’t have.