MINISTERS BACK DETERRING TAX HAVENS
July 19, 2021 - Douglas Myser
Ministers back deterring tax havens. With the economic fallout form the COVID-19 pandemic slowly receding, and the world's economies slowly trying to get back to normal, the world's finance ministers are trying to find ways to find more revenue to fund the huge spending programs needed to boost the economy in one of the worst economic downturns the global economy has ever seen. The extent of the downturn will be felt for a generation, and the tens of trillions of dollars being spent worldwide to kick start the global economy is unprecedented. With that being said, it looks like the days of tax havens for large corporations may be coming to a close. Those days were a rush to find the country with lower tax rates than the company where a corporation actually started its business, and flourished, but moved with virtually no loyalty to anyone but the shareholders and those at the very top. Ministers back deterring tax havens.
Top finance ministers representing some of the world's economy have backed a revision of international taxation that includes a 15% global minimum corporate levy to deter big companies from resorting to low rate tax havens. Finance ministers from the Group of 20 countries endorsed the plan at a meeting in Venice.U.S. Treasury Secretary Janet Yellen said the proposal would end a "self defeating international tax competition" in which countries have for years lowered their rates to attract companies. She said that had been "a race that nobody has won. What it has done instead is to deprive us of the resources we need to invest in our people, our work forces, our infrastructure." The next steps include more work on key details at the Paris based Organization for Economic Cooperation and Development and then a final decision at the Group of 20 meeting of presidents and prime ministers on Oct. 30-31 in Rome. Once that has happened, the stage should be be set for a new ear of taxation that is much fairer and will bring in more revenue worldwide at a critical time.