Rich nations confident on reaching tech tax deal

Rich nations confident on reaching tech tax deal

Finance ministers from the G7 group of leading economies are confident of striking a deal on taxing multinational companies at their meeting in London.

The agreement is expected to include a global minimum rate of corporation tax.

It would target tech giants such as Amazon and Microsoft.

German finance minister Olaf Scholz said the deal would "change the world".

He said a 15% rate would help pay back debts that have built up during the pandemic - and that he was "absolutely confident" there would be an agreement.

"If we agree on the minimum taxation for corporates, this will help to go out of this race to the bottom we see with taxes today," 

"And this will help the countries we live in to finance their tasks, and - especially after Covid crisis and all the money we spent - to defend the health of the people, and to defend the economy."

Starting points and sticking points

Both ministers said agreement on a minimum rate remained a sticking point.

Mr Le Maire said he saw the 15% rate as a "starting point".

He said: "If it can be higher, it is better to have a higher rate than 15%."

Mr Scholz suggested that 15% would be an effective starting point that would mark a "turning point" after years of going in the other direction.

It came after UK Chancellor Rishi Sunak said he was "confident" of reaching a global agreement on digital taxation ahead of a meeting of world finance leaders.

Finance minsters will also discuss climate change at the two-day meeting which started in London on Friday.

Ahead of the G7 talks, Mr Le Maire and Mr Scholz along with their counterparts in Italy and Spain co-signed a letter urging an agreement on an international tax system "fit for the 21st Century".

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