After getting pressure from the United States (U.S.) administration, the European Union (EU) had to comply by agreeing to suspend corporate tax plans for the bloc in a bid to expand the broader global tax treaty. Even so, Ireland continues to criticize the action.
The world’s 20 largest economies confirmed on Saturday plans to overhaul global corporate taxes that will introduce minimum tax rates and change the way large companies like Amazon (NASDAQ: AMZN) and Google (NASDAQ: GOOGL) are taxed. If previously, taxed was based on the location of headquarters, the latest tax will be taxed based on where they sell their products and services.
The reforms will have to go through several processes and are expected to be completed in October which will require parliamentary approval in more than 130 countries. On the other hand, in an effort to remove barriers to the global deal, the EU had to bow to US pressure by saying on Monday that it would postpone its own plans for a separate collection on online sales, which the US administration fears could lead to more criticism of the good. recover global taxes in the U.S. Congress.
The announcement coincided with a visit by the U.S. Secretary of the Treasury. Janet Yellen to Brussels and followed repeated pressures from the G20 summit over the weekend and before.
Even so, there is still criticism within the EU itself especially from Ireland, Hungary and Estonia. Ireland has said it cannot support a minimum 15% rate for global tax rates.
