FRANKFURT, Germany (AP) — Some 130 countries have agreed on a global minimum tax backed by President Joe Biden as part of a worldwide effort to keep multinational firms from dodging taxes by shifting their profits to countries with low rates.
The agreement announced on Thursday last is an attempt to address challenges presented by a globalised and increasingly digital world economy in which profits can be relocated across borders and companies can earn online profits in places where they have no taxable headquarters.
The deal calls for a global minimum tax of at least 15 per cent, a key element pushed by Biden as he seeks to raise more revenue for his infrastructure and clean energy plans. Technical details still need to be worked out and it would be at least 2023 before the agreement takes effect.
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