G-7 Ministers Agree On Biden’s Global Tax Plan
By Stefan J. Bos, Chief International Correspondent Worthy News
(Worthy News) – In a victory for U.S. President Joe Biden, finance ministers for the Group of Seven advanced economies agreed to reshape the tax obligations of multinational corporations worldwide.
The deal on a 15 percent minimum global tax rate was reached at Saturday’s G7 meeting by Canada, France, Germany, Italy, Japan, Britain, and the U.S.
It followed the Biden administration’s effort to establish a floor on the taxes paid by corporations worldwide.
Treasury Secretary Janet Yellen said about this weekend’s G7 talks in London that the U.S. needs international counterparts to prevent nations from being played against each other by firms seeking lower taxes.
However, governments in countries such as Hungary, one of the European Union’s most vocal supporters of previous ‘America First’ President Donald J. Trump, rejected the plans. “It has become clear over the past decade that raising taxes is a dead-end street,” said Hungarian Foreign Minister Péter Szijjártó.
He stressed that “the most effective incentives for creating jobs and triggering economic growth are tax cuts.”
Markets were also uncertain following the weekend G7 gathering. Asian markets were mostly lower as investors also mulled the impact of the G7 global tax plan on tech giants.
However, Yellen hailed the “unprecedented commitment,” saying in a statement that a global minimum tax “would end the race to the bottom in corporate taxation.”
Yellen also said President Biden should push ahead with his $4 trillion recovery plan for the world’s top economy even if it triggers inflation and leads to higher interest rates.
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