The United States, Britain and other leading nations reached a landmark deal on June 5 to pursue higher global taxation on multinational companies.
The G7 said it would back a minimum global corporation tax rate of at least 15%, and put in place measures to ensure taxes were paid in the countries where businesses operate.
“We commit to reaching an equitable solution on the allocation of taxing rights, with market countries awarded taxing rights on at least 20% of profit exceeding a 10% margin for the largest and most profitable multinational enterprises,” G7 added.
“After years of discussion, G7 finance ministers have reached a historic agreement to reform the global tax system to make it fit for the global digital age,” British finance minister Rishi Sunak told reporters.
Tech giants such as Amazon and Google could be among the companies affected.
The deal announced on June 5, between the US, the UK, France, Germany, Canada, Italy and Japan, plus the EU, will help governments to pay off debts incurred during the Covid crisis.
According to UK Chancellor of the Exchequer Rishi Sunak the agreement was designed to create a level playing field for global companies.