Berlin Federal Minister of Finance Olaf Scholz does not want the planned global tax reform to be dragged off despite the corona virus crisis. Every company has to pay its fair share. “That is why it remains important, even in this time of crisis, to put an end to profit transfers and tax avoidance,” said Scholz on Thursday.
There should be no downward competition. It must be ensured worldwide that there is a minimum tax and that the tax system also fits the increasingly important digital industry. “We’re not quite there yet.”
The industrialized countries organization OECD wants to develop a new tax system with the support of 137 countries. Concrete suggestions should actually be made this year. At the G20 meeting in Saudi Arabia in February, Scholz was cautiously confident that there will still be a solution in 2020. “We have to be successful,” he said now.
An agreement would bring more budgetary resources, would be fairer and could prevent double taxation and solve trade disputes. A Treasury spokesman said plans were high on the agenda. The effects of the coronavirus pandemic on the schedules are currently being examined. Actually, an OECD conference with more than 130 countries is supposed to take place in Berlin in early July.
Experts are much more pessimistic than Scholz behind the scenes. “There is a danger that plans for a major tax reform will now be put on the back burner,” said an insider from the Reuters news agency. “In such a global economic crisis, everything has to be sorted out first. Nobody knows what the world looks like afterwards. So you can’t just decide new tax rules. “
If it succeeds, it could be the largest international tax reform in around 100 years. In particular, tax avoidance for globally active Internet groups such as Apple, Facebook, Google and Amazon be prevented. Clarifying technical details is difficult.
More: With the global minimum tax, there is a risk of patchwork on your own.