Nobody likes to pay taxes. It is therefore not surprising that large, multinational corporations like to move profits to countries with low tax rates, and they do so completely legally. Many of these so-called tax havens are not islands under palm trees like the famous Cayman Islands. Ireland, for example, attracts companies with a nominal tax rate of 12,5 percent. In the US, 35 percent would be due. So it is no coincidence that numerous multinational corporations such as Facebook, Google and Apple have their European headquarters in Ireland.
Now they should pay at least 15 percent corporate income tax in the future. 131 countries recently agreed on this under the umbrella of the industrialized nations organization OECD. Among the eight countries that do not want to go along are Ireland and the low-tax countries Hungary and Estonia from Europe. Their resistance could become a problem within the European Union, as unanimity is required for the introduction of a global minimum tax in the EU.
The Irish insist on theirs
From Ireland's point of view, it is a country's primary right to set its own tax rates. "For the Irish government it's about principle," said Brian Keegan of the Association of Chartered Accountants Ireland, the "Handelsblatt". A global minimum tax would deprive Ireland of the sovereignty to determine its own tax rate.
The finance ministers of the G20, the world's 20 leading industrialized and emerging countries, should pave the way for an agreement this week at their meeting in Venice. The G20 - the EU is a full member alongside its three member states France, Germany and Italy - have also spoken out in favor of a global minimum tax and should now officially confirm it.
The project is considered revolutionary because it is supposed to ensure more justice in the world. The OECD speaks of 8.000 international corporations worldwide that in future will have to pay at least 15 percent taxes in every country in which they operate. If the tax rate is below the new minimum value of 15 percent, the Group must post-tax the difference in its home country. Often it is the USA who want to plug their tax holes with the additional income. "The Irish finance minister Paschal Donohoe would have to think about whether he would continue to demand only the fabulous 12,5 percent from Apple and leave the rest of the tax revenue to colleague Janet Yellen in Washington," writes the "Süddeutsche Zeitung".
With a minimum tax of 15 percent, the OECD expects additional income of around 150 billion dollars per year. The new rules should apply from 2023, which is considered ambitious. Germany's Finance Minister Olaf Scholz was optimistic when he arrived in Venice. "There are no longer any sticking points with the global minimum tax," he said. The project is no longer in danger.
Outside of politics, there is strong criticism of the plans. The development organization Oxfam described the tax as "unfair" and "too low". She criticizes the fact that the G7 countries would benefit from it, since many of the large corporations are based there - at the expense of poorer countries.
The Attac movement, which is critical of globalization, falls in the same direction. Attac does not see a fair and effective solution in the fight against corporate tax tricks. "The global minimum tax of 15 percent will not stop the global tax race downwards, but rather fuel it," it says. The distribution of the additional income from both pillars of the reform would put poorer states at a massive disadvantage, which are already suffering the most from the profit shifts. Attac demands a global minimum tax of 25 percent.
Doubts about expected additional income
There are also doubts about the additional revenue for the states. In the opinion of the Siemens group, this would result in massive expenditure for companies and tax offices. "The calculation effort for the company and the audit effort for the tax authorities worldwide as well as the risks of double taxation are unlikely to be in any reasonable relation to the likely moderate fiscal effects," the group said.
Siemens is one of the largest German companies that are subject to the minimum tax. In addition, the group could in future be affected by the fact that the 100 largest and most profitable companies worldwide are supposed to pay their taxes more than before where they are active in the market and less where they are based. (ede / apa)