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Holdout Ireland agrees to sign up, so global tax transactions will be close to a few inches

Photo taken in Dublin, Ireland

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Ireland has made a big difference in its policy by deciding to sign a global contract to raise the corporate tax rate to 15%.

Earlier this summer, the G7 and G20 countries agreed to work together to tackle tax evasion and harmonize rules around the world. If this plan is implemented, multinationals will be forced to pay taxes not only where their headquarters are located, but also where they do business, with a corporate tax rate of at least 15%.

The Republic of Ireland, one of the most attractive companies in the world, with 12.5%, has previously refused to participate in the plan. Various Irish governments have strongly defended low interest rates, arguing that they are a tool for attracting businesses to small economies.

On Thursday evening, Irish broadcaster RTE reported that the Cabinet had approved a corporate tax increase from 12.5% ​​to 15% for companies with sales of more than € 750 million. The news was later confirmed by Irish Treasury Minister Paschal Donohoe.

“We must remember that 140 countries were involved in this process and many had to compromise in joining the agreement,” the RTE said.

“But I believe the agreement that the government has agreed to sign to date is balanced and represents a fair compromise that reflects the interests and opinions of many countries involved in the negotiations. . “

According to the RTE, the Irish Treasury estimates that participating in this global transaction could reduce the country’s tax burden by € 2 billion ($ 2.3 billion) annually. In addition, a poll by The Irish Times showed that the majority of Irish voters believe that the government should not change its policy right now.

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However, the change of mind in Ireland followed the revised text. The first transaction stated that the minimum corporate tax rate was “at least 15%”, but this has been updated to just 15%. This indicates that this tax rate will not be raised at a later date. Ireland was also given a guarantee that interest rates on SMEs located in the country could be kept low.

compromise

In a meeting with CNBC on Wednesday, Hungary’s Minister of Foreign Affairs and Trade Péter Szijjártó said at the first meeting that the corporate tax rate was 21%, far from the current 9% in Hungary. Therefore, he said, the new level of 15% is somewhere in the middle.

Hungary has not yet approved a global tax agreement. However, the minister said Budapest was keen to participate if a ten-year implementation period was agreed.

Meanwhile, France’s Finance Minister Bruno Le Mer is a supporter of the global tax agreement, and on Wednesday the CNBC told CNBC that the global tax agreement was “1 mm away“From arrival.

“The important point is to adopt an agreement on a new international tax system by the end of this month,” he said in Paris.

“We were able to sign a final agreement under international taxation during the Washington Conference next week or at the G20 conference in Rome at the end of October,” he added.

Holdout Ireland agrees to sign up, so global tax transactions will be close to a few inches

Source link Holdout Ireland agrees to sign up, so global tax transactions will be close to a few inches

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