Berlin and Paris support US proposal for 21% minimum tax for multinationals

France and Germany support the United States’ proposal to introduce a global minimum tax on corporate profits at 21%, the finance ministers of the two countries said in an interview published on Tuesday (April 27th).

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“If it was the result of the negotiations, we would agree”, Frenchman Bruno Le Maire told German weekly “Die Zeit” and “Figaro”. His German counterpart Olaf Scholz declared for his part that he had “Nothing personally” against the proposal.

“People are fed up with big business not paying their fair share of taxes”, added Bruno Le Maire. France had recently mentioned a tax rate of 12.5%, he recalled. But if the 21% rate suggested by Washington “Was the result of negotiations, we would agree”, he added.

An agreement “this summer”

The two ministers said they were confident about a deal ” this summer “ on the subject at the OECD. This is the first time that the two governments have mentioned their support for such a floor rate.

Negotiations are underway within the OECD to achieve a system of minimum international taxation of companies and to put an end to the fiscal dumping they engage in around the world.

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The project has been supported for several weeks by the United States, which is seeking to raise their corporate taxation to finance a massive infrastructure plan. The goal is above all to increase the contribution of digital companies, accused of evading tax thanks to the differences in taxation between countries.

Floor rate against Gafa tax

If the negotiations at the OECD are successful, France has already said that it would adopt a European directive on the subject in the first half of 2022, during the French presidency of the Union.

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Bruno Le Maire also warned that he “Would withdraw” the Gafa tax in the event of successful negotiations. This tax on digital companies, mainly American, has been at the heart of tensions between France and the United States in recent years. In case of failure, “We will keep it”, he added.

In mid-April, the European Commissioner for the Internal Market Thierry Breton hailed as a “Elegant solution” the American proposal.

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