Guzmán praises G7's minimum global corporate tax initiative

Economy Minister Martín Guzmán has praised a landmark agreement by the Group of Seven rich nations that could help countries collect more taxes from big companies.

The agreement by the G7 finance ministers in London satisfies a longstanding demand from the United States for a minimum corporate tax rate of “at least 15%” on foreign earnings and paves the way for levies on multinationals in countries where they make money, instead of just where they are headquartered.

Responding to the news, Argentina's economy minister said the move to create a global minimum tax rate of 15 percent is "a positive step to attack tax avoidance from multinationals that weakens nation states and threatens development."

"We celebrate the commitment of the G7," said the official, though he warned that "he minimum rate will probably also be the maximum rate. And 15 percent is very little."

For her part, the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, said the deal a "historic step in the matter of international taxes."

The G7 deal is aimed at modernising the century-old international tax code and cools transatlantic tensions that threatened to spill into a trade war under former US president Donald Trump. But key details are still to be nailed down, more nations must sign on, and full implementation could take years.

US Treasury Secretary Janet Yellen, among the finance chiefs who hailed the announcement as an unprecedented step, said a final accord on which companies could see their profits taxed outside their home countries would include the likes of Amazon and Facebook.

– TIMES/BLOOMBERG/NA