LONDON: A group of the world's richest nations reached a landmark deal on Saturday to close cross-border tax loopholes used by some of the world's biggest companies.
The accord, which could form the basis of a global pact next month, is aimed at ending a decades-long"race to the bottom" in which countries have competed to attract corporate giants with ultra-low tax rates and exemptions. According to a copy of the final agreement seen by Reuters, the G7 ministers said they would"commit to a global minimum tax of at least 15 per cent on a country by country basis".
Increasingly, income from intangible sources such as drug patents, software and royalties on intellectual property has migrated to these jurisdictions, allowing companies to avoid paying higher taxes in their traditional home countries.Governments could still set whatever local corporate tax rate they want, but if companies pay lower rates in a particular country, their home governments could"top-up" their taxes to the minimum rate, eliminating the advantage of shifting profits.
So where do the people stand in this deal?
They will move elsewhere.
腐朽机制。
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