Sunday, 17 October, 2021

Nations agree to 15pc minimum corporate tax rate

  • Sun Online Desk
  • 9th October, 2021 09:47:44 AM
  • Print news
Nations agree to 15pc minimum corporate tax rate

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Most of the world's nations have signed up to a historic deal to ensure big companies pay a fairer share of tax, reports BBC.

Some 136 countries agreed to enforce a corporate tax rate of at least 15%, as well a fairer system of taxing profits where they are earned.

It follows concern that multinational companies are re-routing their profits through low tax jurisdictions to cut their bills.

Yet critics say a 15% rate is too low, and firms will get around the rules.

The Organisation for Economic Cooperation and Development (OECD), an intergovernmental organisation, has led talks on a minimum rate for a decade.

It said the deal could bring in an extra $150bn (£108bn) of tax a year, bolstering economies as they recover from Covid.

The floor under corporate tax will come in from 2023. Countries will also have more scope to tax multinational companies operating within their borders, even if they don't have a physical presence there.

The move - which is expected to hit digital giants like Amazon and Facebook - will affect firms with global sales above 20 billion euros (£17bn) and profit margins above 10%.