Thursday, September 23

What does the global minimum tax on multinationals agreed by the G7 mean for Latin America?

  • Cristina J. Orgaz @cjorgaz
  • BBC News World

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Image source, Getty Images

Neither an army of legal advisers nor the pressure groups in the institutions of each country have managed to stop one of the biggest tax reforms at the global level in recent decades.

The finance ministers of the G7, which groups together the world’s seven main economies, reached an agreement this Saturday that is considered historic and that is intended to tax the profits of multinationals with a minimum amount, but which will be the same for all: at least 15%.

This point is important because slows the race between jurisdictions to offer the highest corporate tax discounts, something that causes many companies to move their headquarters to tax havens or territories with very low taxation in order to pay less or even nothing.

In this way, the seven most advanced economies in the world are promoting a plan to combat tax evasion and make companies pay in the countries where they do business, regardless of where the headquarters of its subsidiaries are located.

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