Business leaders of the globe’s 20 major economies have agreed on a corporate tax (minimum of 15%) that will be levied on the profits of large-sized businesses.
This agreement arrives after a concern that MNCs are re-channeling their profits via low tax jurisdictions.
The corporate tax deal was agreed upon by all the eminent leaders that were present at the G20 conference held in Rome.
The G20 corporate tax proposal
The challenges of the Covid19 pandemic and climate change are also on the schema of the summit, which is the leaders’ foremost physical gathering since the commencement of the pandemic.
The G20 conglomerate comprises 19 countries and the European Union. Russia’s Vladimir Putin and China’s Xi Jinping graced the summit via a video link.
The corporate tax agreement was proposed by the United States of America and is estimated to officially apply from Sunday, according to Reuters. The corporate tax agreement will be imposed by 2023.
Janet Yellen, US Treasury Secretary, stated that the historic agreement of corporate tax was a crucial moment for the world’s economy and will demolish the destructive race to the bottom on corporate taxes.
Under this agreement, a minimum of 15% will be levied on the profits of large-sized businesses.
The G20 summit arrives much before the most-anticipated COP26 conference on climate change held in Glasgow. The proceedings of the G20 summit will set the foundation for COP26, with distinct divisions prevalent between nations on their commitments to dealing with climate change.
Italy’s Prime Minister Mario Draghi commenced the two-day G20 conference by telling world leaders that all nations must strive to unify with one another and demolish existing differences for the greater good.
There are several significant warnings from experts for the future if imperative action is not taken to eliminate carbon emissions.
UK Prime Minister Boris Johnson told BBC that climate change was the biggest enemy of humanity and stated that there is an apparent risk to civilization curving backwards.
However, Mr Johnson accredited that neither the COP26 nor the G20 meeting would curb global warming, but if the right preventive measures were taken, there was no stopping of the cooling down of the planet.