The Organisation for Economic Cooperation and Development is currently working on plans for a minimum corporate tax rate as part for a global revision of its tax rules as a way to prepare for the digital era.
The emergence of digital giants like Google and Facebook has pushed international tax rules to the limit due to booking profits in countries with the lowest taxes without caring where the customer is.
According to the OECD during its statements, around 127 countries, and territories have agreed last week that a planned revision of global tax rules by 2020 would tackle some of the most vexed issues, including as how to divide up the right to tax digital firms’ cross-border income between countries.
France and Germany made a proposal where they agreed to look at different ways to give countries more leeway to tax revenue booked in other countries with no or low tax.
In the absence of international rules that could prevent firms from shifting profits to low-tax countries, the still growing number of countries are creating their own national taxes that has as specifically target big digital firms.
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