US Treasury Secretary Janet Yellen announced at the G20 forum that the United States will no longer oppose work on a global digital tax. Previously, the whole process was blocked by the previous presidential administration.
The United States is under leadership Donald Trump They were very reluctant to impose new taxes on activities outside the United States. Many European countries (led by France) complained that profits made in their markets were transferred abroad to avoid taxes.
But Washington has put so much pressure on Paris that it has threatened retaliatory tariffs on, for example, French wines and cheeses. The United States has formally supported the development of solutions at the Organization for Economic Cooperation and Development (OECD) forum, which brings together highly developed democracies.
But last year a former secretary of treasures Steve Mnuchin The United States has withdrawn from the OECD negotiations and the idea of a global digital tax has become highly questionable. And now the successor to Mnokhin announced that Washington would withdraw its blockade. “We give up our opposition,” she told her colleagues from other G20 countries. Janet Yellen.
Europe breathed a sigh of relief
The announcement of the new US administration was received with satisfaction in Europe. Washington’s change of position was a breakthrough. This is a big step forward on our way to concluding a digital tax deal by the summer of this year, Germany’s finance minister said. Olaf Scholes Immediately after a videoconference of G20 ministers.
The French Economy Minister reacted with equal enthusiasm, which recently threatened the United States to suspend its digital tax that was adopted in 2019 (but which was quickly frozen for the duration of the OECD negotiations). An agreement must be reached by summer. I call for an immediate conclusion of these negotiations Bruno the mayor.
Early in January, Secretary Yellen indicated that the United States was ready to lift the blockade while her pre-appointment congressional hearings were still ongoing. “I support efforts to ensure that companies pay a fair share of taxes. I also support removing incentives for companies to operate abroad,” she declared later to the senators.
Heavy losses in the state budgets
According to data from the Organization for Economic Cooperation and Development, the budgets of countries around the world lose about $ 240 million annually due to tax evasion by international companies. According to the Tax Justice Network, this amount is an understatement, because we have to be talking about more than 0.5 trillion dollars.
Example, for example, Facebook in Poland. At the end of 2018, the portal was 44 percent utilized. Poles and Polish women – approximately 17 million people. Although Facebook was supposed to earn PLN 600 million PLN on ads submitted to Polish users in 2017 (according to estimates by PwC), it does not pay any taxes in Poland.
This is possible because companies enjoy the freedom of the European Union to provide services: they register in tax havens. In the case of Facebook, it is Ireland, where the official corporate tax rate is 12.5 percent, but global corporations actually pay 2 to 5 percent in this country. CIT. They offer services all over Europe, and they only pay low fees in the country they reside in.