Paris:French President Emmanuel Macron on Saturday hailed the “historic” agreement of 136 countries on setting a minimum tax rate for multinationals as a major advance in fiscal justice.
The OECD-brokered deal, which sets a global tax rate of 15 percent, is aimed at stopping international corporations from slashing tax bills by registering in nations with low rates.
The international push for a minimum international tax on big corporations moved closer to reality on Friday as one of the last holdouts, Hungary, agreed to join a reform that now counts 136 countries.
Hungary’s announcement came a day after another key opponent, Ireland — whose low tax rate has attracted the likes of Apple and Google — relented and agreed to join the global effort.
Estonia also joined the reform on Thursday.
The 136 nations now on board represent 90 percent of global gross domestic product.
Under the deal they will be able to generate around 150 billion euros $175 billion) in additional revenue from 2023.
“For four years, we have been working for fair taxation of multinationals and digital giants,” Macron said Saturday.
“The tax agreement reached at the OECD is historic. Every multinational company will have to pay a minimum of 15 percent tax. This is a major step forward for tax justice,” the French president tweeted.
Some NGOs and economist consider the tax move insufficiently ambitious, and argue it will create inequalities between rich and developing countries.
According to Oxfam, the poorest countries will receive less than three percent of the supplementary tax receipts.
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