- April 7, 2021
- Posted by: medium
- Category: International
Among the topics that will be discussed is also the proposal for a global business tax.
This Wednesday, the finance ministers of the G20 countries and the leaders of the central banks of the 20 richest countries in the world meet virtually to coordinate economic reactivation and increase aid to the poor countries hardest hit by the coronavirus pandemic.
The meeting also discusses the proposal by the Secretary of the Treasury of the United States, Janet Yellen, to introduce a global minimum tax on corporate income.
This initiative, which seeks to end competition for downward taxes between countries and the use of tax havens by companies, is among the most important issues on the agenda.
The global economy is estimated to recover from the pandemic faster than expected, with growth of 6% this year, the International Monetary Fund (IMF) said on Tuesday.
However, emerging countries are lagging behind, due to limited budgetary resources and the slowness of vaccination campaigns.
The group of the world's 20 richest countries will likely decide on a debt payment moratorium for the poorest nations until the end of the year.
The moratorium, which was extended in October until June 30, 2021, had a fairly limited impact.
Only 46 countries, of the 73 indicated, requested and obtained the deferral of interest payments, for an amount of 5.7 billion dollars.
IMF and the United States
The G20 should also support the use of a new issuance of special drawing rights (SDRs), a proposal put forward in late March by IMF Managing Director Kristalina Georgieva.
The proposal consists of an allocation of SDRs for an amount equivalent to 650 billion dollars that would give additional ammunition to the institution to help countries recover from the crisis caused by the pandemic, “providing additional liquidity to the economic system,” according to the IMF leader.
The G20 finance ministers will also speak out on the United States proposal for a global minimum tax on companies. The group could unveil a proposal in July.
The idea has been promoted by the Organization for Economic Co-operation and Development (OECD) and received further impetus this week when the US Treasury secretary announced that she would seek an agreement at the G20.
No rate has been decided, but estimates range from 12.5% to 21%.
The international reform would have two components: the minimum tax rate and the establishment of a system to modulate corporate taxes based on profits in each country, regardless of where companies are based, which would probably affect the technology giants the most.
At the last G20 meeting, held in February, the big money generators set the goal of reaching a consensus on a digital tax by mid-2021.