Global tax deal aims to raise $250 billion

The world’s leading finance ministers agreed new rules for taxing profits Friday, warning multinational companies they can no longer use their size and international presence to dodge taxes.


Under the new rules, companies such as Starbucks, Amazon and Google will find it harder to concentrate their profits in low-tax countries and tax havens, raising up to $250bn a year in additional tax revenues, according to the OECD.


Angel Gurr?a, head of the OECD, the club of mostly rich nations that has drawn up the new rules, said it was time “to recover the trust of our citizens” and move to the next phase of a “well- defined trilogy: implementation, implementation, implementation”.


The plans to crack down on corporate tax avoidance were devised by more than 60 governments in the first big overhaul of the rules for taxing profits for nearly a century.


But campaigners have criticized the rules for merely patching up the existing system, although businesses say they have a greater degree of consensus than initially expected.


The rules, called “base erosion and profit shifting” or Beps, are designed to close loopholes and restrict the use of tax havens. They are the culmination of an ambitious international project launched two years ago by G20 governments in response to public anger over corporate tax avoidance.


Finance ministers from the world’s largest economies hailed the rules, which they hope will raise tax revenues and force companies to pay what they owe. Lou Jiwei, China’s finance minister, said each nation must “enhance domestic reforms” to implement the rules.


Read More: Global tax deal aims to raise $250 billion | Business , International | THE DAILY STAR

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