Politics 130 nations agree to support U.S. proposal for global minimum tax on corporations

[tom_mai78101]

WASHINGTON - Treasury Secretary Janet Yellen announced Thursday that a group of 130 nations has agreed to a global minimum tax on corporations, part of a broader agreement to overhaul international tax rules.

If widely enacted, the GMT would effectively end the practice of global corporations seeking out low-tax jurisdictions like Ireland and the British Virgin Islands to move their headquarters to, even though their customers, operations and executives are located elsewhere.

“For decades, the United States has participated in a self-defeating international tax competition, lowering our corporate tax rates only to watch other nations lower theirs in response. The result was a global race to the bottom: Who could lower their corporate rate further and faster? No nation has won this race,” said Yellen in a statement on the accord.

“Today’s agreement by 130 countries representing more than 90 percent of global GDP is a clear sign: the race to the bottom is one step closer to coming to an end,” Yellen said.

Yellen’s announcement did not include the actual rate at which the GMT would be set, but the Biden administration has pushed for at least 15%.

130 nations agree to support U.S. proposal for global minimum tax on corporations

A group of 130 nations has agreed to a global minimum tax on corporations, part of a broader effort to overhaul international tax rules.

www.cnbc.com

 

[The Helper]

This is definitely needed but it really will not fix anything because loopholes will still be left in but at least they will have to change because this jig is up on this one.

 

[Ghan]

I prefer the FairTax. That said, the US recently had some of the highest corporate income tax rates in the world, and I think the economy did pretty well after they were reduced.

The main issue here is how we look compared to the rest of the world. We need to make sure we can remain competitive with regard to tax policy or we'll drive companies elsewhere.