G-20 wants multinational companies to pay more taxes
ST. PETERSBURG, Russia — It's time to make Google, Apple and other multinationals pay more taxes, say President Obama and the leaders of the world's leading economies as they committed on Friday to crack down on cross-border companies that use tax havens.
French President Francois Hollande called the deal “perhaps the most important” agreement reached at the G-20 summit.
The G-20 leaders agreed to an unprecedented deal to share information on individual taxpayers, despite resistance by China.
Low tax payments by major global companies such as Google or Amazon have sparked public anger in Europe as countries struggle out of recession.
The Organization for Economic Cooperation chief Angel Gurria said that it's crucial that Internet giants like Facebook are covered by the new rules.
“You've got to get the big guys to make a contribution,” Gurria said. Otherwise, he said, “What are the treasurers, the ministers of finance left with? Medium and small-scale enterprises, the middle class to tax?”
But the G-20 leaders may find political battles at home in getting the tax treaties and laws in place.
The OECD, which is designing the global tax rules, has come under fire from cross-border corporations that say they're being unfairly targeted.
Gurria, in an interview, insisted that the tax plan isn't anti-business.
“We don't want to discourage companies from creating jobs. But we obviously don't want to encourage companies to take away the profits and squirrel them away and not share them with anybody else,” he said.
The plan includes ways to close loopholes and allow countries to tax profits held in offshore subsidiaries.