The G20 countries have signed the agreement on a global minimum corporate tax. This should help prevent global companies from moving their profits to low-tax countries.
The agreement signed by members of the G20 and the OECD sets the global minimum tax for companies at 15%. The agreement will come into force in 2023 and is not expected to have any impact on small businesses.
132 countries have signed the agreement.
Countries such as Ireland and Hungary have not signed the agreement.
Companies with sales of more than $890 million pay at least 15% in taxes.
Companies with sales of more than $23 billion pay between 20% and 30% of their profits exceeding a 10% margin to the countries where their products or services are sold.
This is intended to direct corporate taxes to the countries where their products are sold, rather than to the countries where their headquarters are located.
On the subject of inflation, the finance ministers of the countries have said that they will take appropriate measures if necessary. However, with inflation already at high levels and supply chains stagnant, the question remains as to what measures can be taken.
They also reiterate that they will try to maintain a strong economic recovery by avoiding the withdrawal of stimulus measures in advance.