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G7 finance ministers of seven major countries have agreed to set the global corporate tax rate to at least 15%.
This is a measure to prevent large IT companies such as Google and Apple from reducing taxes by redirecting their sales to countries with low tax rates.
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From Ireland with only 12.5% to France with over 30%.
The difference in corporate tax rates in each country has been a channel for multinational IT companies such as Google and Facebook to reduce taxes by redirecting their sales to countries with lower tax rates.
The G7 finance ministers of seven major countries have agreed to set each country's corporate tax rate at least 15% or higher to prevent such side effects.
Profits exceeding 10% of operating profit as a percentage of total sales will be taxed in the country where the sales are at least 20%
[Receiving sunak / British Finance Minister: the end of the discussion for many years, has been made a historic agreement to reform the global tax system to fair and appropriate for the digital age;
foreign corporation tax paid for that country does not have the lowest tax rate of 15% Any remaining tax must be paid at the location of the headquarters.
Even if you drive sales to countries with lower tax rates, you end up paying a 15% tax.
Korean companies with an effective corporate tax rate of over 20% are not expected to be significantly affected.
[Kim Hak-soo/KDI Research Fellow: The effective corporate tax rate (of domestic conglomerates with sales exceeding KRW 500 billion) is over 21%. Therefore, Korean companies will not have to pay any additional tax.]
Rather, as foreign IT companies can pay more tax with the profits they earn in Korea, the effect of expanding tax revenue can be expected.
This plan is expected to be finalized after the G20 Finance Ministers Meeting next month and the G20 Summit in October.
(Video editing: Lee So-young)