g7 reaches historic agreement

Historic G7 Agreement to Support a Global Minimum 15% Tax on Business

Business Press Release
  • The pact will be discussed at the meeting of the G20 and central banks to be held in July in Venice.
Archive image of the G7 meeting.
Archive image of the G7 meeting.

The world’s most developed economies, meeting at the G7 , reached a “historic” agreement in London on Saturday on the reform of the global tax system, announced the British Minister for the Economy, Rishi Sunak.

The deal will require multinational tech giants to make their fiscal contribution, Sunak said in a statement posted on his Twitter account.

Global companies such as Amazon , Google or Facebook will be the most affected , since now they can legally tax in a country with advantageous tax conditions the business they generate in other countries. With this change, rich countries seek to avoid a “race to the bottom” in fiscal policies.

The G7 ministers – the United States , the United Kingdom , Germany , France , Canada , Italy and Japan – agreed to commit to at least a 15% minimum corporate rate.

The pact will be discussed at the meeting of G20 finance ministers – developed and emerging countries – and central bank governors to be held in July in Venice .

“I am delighted to announce that today, after years of discussions, the G7 finance ministers have reached a historic agreement to reform the global tax system ,” Sunak said at the end of the meeting, held at the Lancaster House palace, in the center of the British capital.

The pact is designed to adapt it to the “global digital age” and, “what is crucial, to ensure that it is fair, so that the right companies (the tech giants) pay the right tax in the right place and that is a price huge for the British taxpayer, “added the head of Economy.

“The agreement reached here says that at least 15% (corporate tax),” insisted the minister, defending his decision not to press for a higher percentage, 21% , as the US administration wanted.

“This is something that has been talked about for at least 10 years. And here, for the first time today, we have reached an agreement of tangible principles on how these reforms should be and that is great progress, ” added Sunak, who called the system “fair”.