This is the first time that G7 members have agreed to impose a tax on large international companies, with a minimum tax of 15%. On the Bercy side, we say we are satisfied, making it clear that this rate may still expand. In the care of the Minister of Finance, we welcome “a good start”. “For the first time in years, G7 member states can define the rules of the 21st century international system,” Bruno Le Meyer said in a video posted on his Twitter account. “This is a great deal. It is a deal that France can be proud of after four years of struggle. France has won. It should fill us with pride,” he said.
Here we are!
After four years of struggle, the G7 reached a historic agreement with member states to impose a minimum tax on companies and digital giants.
France can be proud! pic.twitter.com/eIMqjweyjl
– Bruno Le Meyer (r Bruno Lear) June 5, 2021
Why is this a “historic” deal?
“The international community is doing something that the EU has not achieved. The idea of imposing corporate taxes within the EU has long been accepted, but we have never been able to find a deal,” said economist Nicholas Bouzou, who cites “the relatively large impetus of the United States on this issue.” From 1. “Joe Biden is very careful to find tax revenue, especially on the business side,” he says.
Who pays this tax?
It is aimed at large tech companies, such as GAFAs, such as Google, Amazon, Facebook or Twitter. Moreover, there will be large pharmaceutical companies. With this tax, these large multinational corporations will have to pay taxes in value-added countries. “All G7 countries will have a tax rate of at least 15% on the profits of these companies,” Nicholas Buzzou added.
What are we going to pay in taxes?
“It’s about tax recovery on profits located at tax bases, so there’s a very important aspect of tax justice,” points out OECD Director Europe 1 Pascal Saint-Amans. “Tax revenues will increase significantly. I have no specific figures for France, but we can talk about billions a year. Globally, it is in the order of $ 150 billion a year,” the economist added.
What will happen after this political deal?
Saturday’s deal is just the beginning. It should still be expanding within a month during the G20 in Venice. We need to convince China and other countries like Ireland that they are known for their tax policy that benefits companies. But if negotiations go well, we can expect a final deal by the end of the year.