After the first historic agreement of the G7 in London on 7 June, now comes the second, just as historic because decisive, agreement of the G20 of Venice: the Global minimum corporate tax will be made.
Global tax targets are multinational companies all, and in particular the so-called Big Tech, Amazon, Apple, Google, Facebook, Microsoft) present in all countries, but with reference points in some (such as Ireland or Luxembourg) whose
The agreement reached at the G20, already renamed Covenant of Venice by Paolo Gentiloni (present as European Commissioner for Economic Affairs: for Italy, as in the first round of the British economics and finance, Daniele Franco) is based on
The first is taxing profits of multinational companies with turnover above EUR 20 billion in the countries in which they operate, on the basis of a minimum rate of 15%.
The second is a minimum tax rate for companies with at least 750 million turnover.
The Global minimum tax set (at the 20 billion turnover threshold) is expected to generate revenue in the first year of 150 billion euros.
This figure is expected to increase as the mechanism is revised (in 2030), with the threshold of applicability being lowered to multinationals generating turnovers of EUR 10 billion.
The agreement must go further along the stages of approval, starting with the next G20, that of 30 and 31 October in Rome (Italy has the presidency of the G20, remember) in which technical details will be established, and then, for our part, in the European fora
Global tax also provides for another mechanism, anti-avoidance.
Combined with the 15% overall measure, the tax will apply to 20%-30% of profits above the 10% profit threshold, an amount to be reallocated in the countries where multinationals make their own sales.
The genesis of the global minimum tax
The first proposal of Global minimum tax for large companies, we remember, had come out of a G7, that of London at the beginning of June, dominated by the personality of the former president of the Fed and new secretary to the Treasury of the US administration, Janet Yellen
From the beginning it was welcomed by the great offices: a great achievement far from obvious for the European Commissioner for the economy Paolo Gentiloni and Â a historical step towards greater fiscal equity Â Â, for the Italian Council president
The most obvious target of the minimum global rate and a tax on earnings to be reinvested in the territory, it has been said, are the Big Tech, known for having always a lively relationship with the ministries of finance, at least of the European countries, in the sense both
But Big Techs know that multinational companies are not just the ones that produce technology, in the form of software or services (cloud).
There are also those in the mining sector and the pharma, to mention two sectors that have played and play a pivotal role in the era of the pandemic. But there are also all those in the retail, agriculture and food sectors.