The world’s largest economy will exert pressure on eight countries refusing to sign a global tax reform agreement that imposes a minimum tax on multinational corporations.
The Southern Caribbean island of St Vincent and the Grenadines are among those countries.
A draft communiqué leaked on July 9 and validated by G20 officials in the Financial Times urges all countries to make concessions by the time G20 leaders meet in Italy in October 2021.
Officials from several G20 countries have said that the exact wording of the communiqué has not yet been finalized, but officials from one influential nation said the approval of the agreement by the G20 meant “there was no turning back.”
Eight countries, including St. Vincent and the Grenadines, Ireland, Barbados, Hungary, and Estonia, have postponed a 15% minimum levy agreement backed by the United States, China, India, and most EU countries.
Other holdouts include Sri Lanka, Nigeria, and Kenya.
Political support for the G20 will give momentum to efforts to reach a final agreement expected to be implemented by 2023, but critical technical issues remain and could be resolved before October.
These include various so-called “curve-out” agreements that allow some countries to use opt-outs from transactions to encourage investment.
The G20 Finance Ministers on July 10 approved a global corporate tax of at least 15 percent to be imposed on multinational companies (MNCs) to end tax-havens.
In the two-day virtual meet headquartered from Venice (Italy), the Group also endorsed a broad agreement plan introducing new rules for taxation of cross-border businesses as reported by ANI.