Many of the word’s nations have come together in the name of taxation.
The Organization for Economic Cooperation and Development announced on Friday that it will set a minimum corporate tax rate of 15%, reports Reuters.
After years of disagreement, 136 nations have agreed to the global corporate tax. This includes Ireland, which had been a longtime opponent of the tax increase until now.
“The landmark deal, agreed by 136 countries and jurisdictions representing more than 90% of global GDP, will also reallocate more than USD 125 billion of profits from around 100 of the world’s largest and most profitable MNEs to countries worldwide, ensuring that these firms pay a fair share of tax wherever they operate and generate profits,” the OECD stated.
— Tax Foundation (@TaxFoundation) October 8, 2021
In addition, companies like Amazon and Facebook will also be forced to pay taxes in the countries in which their products or services are sold regardless of whether or not the company has a physical presence in that country, the New York Times reports.
The details of the agreement have yet to be ironed out and are expected to be finalized next week by finance ministers of 20 of the world’s largest economies. National leaders are expected to sign off on the deal at the end of October at a summit held in Rome.
President Biden’s tax ambitions differ starkly from former President Trump’s Tax Cuts and Jobs Act of 2017. What more can we expect from a far-left president than tax increases, raised debt ceilings, and globalism? However, in order for this plan to move forward Congress will have to pass legislation to raise the corporate tax. Democrats expect to cram legislation through and enforce the tax increase using a legislative procedure called “budget reconciliation”; however, Republicans disagree with this procedure and have stated that the negotiations appear to “undermine the Senate’s constitutional authority, as well as the United States’ role as a reliable trading partner.”