We think that The Economist article is well written as always, but wrong as it consider only one side of the issue and ignores multiple critical factors. The Big Tech is not going to pay their taxes just because there is a global tax bill. Forget it. The low tech will just get the incentives to follow.
However, here is The Economist opinion.
AS IS OFTEN the case in multilateral matters, America held the key. When Janet Yellen, its treasury secretary, announced earlier this year that it was time to end the “global race to the bottom” on corporate tax, her remarks supercharged sputtering talks over a global deal to overhaul how much tax multinational companies pay, and where.
Talks are focused on two main changes: reallocating taxing rights towards countries where economic activity takes place, rather than where firms choose to book profits; and setting a minimum global tax rate, likely to be in the region of 15%. Finance ministers from the G7 group of rich countries are set to signal their approval at a meeting on June 4th-5th.
The broader G20 could agree terms as soon as July, spurring the other 120 or so countries and territories involved in the talks to fall into line. On May 26th Germany’s finance minister predicted a “revolution” in global tax rules “in just a few weeks”.
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