Teller Report

Now you can see non-English news...

OECD relaunches negotiations on taxation of digital giants


OECD relaunches negotiations on taxation of digital giants

Paris (AFP)

The OECD relaunched Wednesday the negotiations on the taxation of digital giants and multinationals, which were stumbling on divergent positions, presenting a "unified approach" to obtain a "political agreement" with the states by the month of June.

"We are getting closer to our ultimate goal: that all multinationals pay their share," said OECD Secretary-General Angel Gurria in a statement. He will present the "unified approach" at the G20 Finance to be held in Washington on October 18th.

The taxation of digital giants and multinationals is a major challenge to adapt global taxation to the digitization of the economy of recent decades, so that states can collect taxes even if the groups are not physically present on their territory .

The negotiations, which opened in the OECD in January after several years of procrastination, were again blocked by the presence on the table of three divergent and "competing" positions from Great Britain, United States and India.

Faced with this situation, the OECD has sought compromise by presenting its own "unified approach" that it puts on the negotiating table, involving 134 countries.

"If the G20 and other countries agree to negotiate on this basis, we could move quickly towards a political agreement," said Pascal Saint-Amans, director of the Center for Policy and Tax Administration of the Organization for Cooperation. and Economic Development (OECD).

- An agreement from January? -

"If we are able to ensure that there is a real negotiation, a political agreement could be reached, why not in January, even if it seems too ambitious, but certainly in June," he added , convinced that "the dynamic is rather positive, even if it is extremely complicated".

For its part, Gurria, quoted in a statement, issued a warning to the 134 countries that are preparing to negotiate the proposal of the OECD.

"If we do not reach an agreement in 2020, it will increase the risk that countries act unilaterally," he warned, referring to France, which has decided to impose the digital giants on their number of business this year.

The proposal of the international institution is based on three pillars. The first defines the scope of the new tax, in other words it stipulates that multinationals that "have significant interaction with end consumers" are included.

On the other hand, those that do not have a direct link with the public, such as car parts manufacturers, who sell their production to manufacturers, would be excluded.

- "Promising" and "complex"

In the second pillar, it provides a system for determining whether or not a country will be able to tax a multinational, depending on the company's turnover. "This is the volume of turnover that would determine a new right to impose for countries," said Saint-Amans.

Finally, it sets the "legal guarantee" for multinationals with an arbitration mechanism in the event of litigation between States and large groups, in order to avoid double taxation.

According to the OECD, the so-called market countries and developing countries would be the winners of this tax reform and the losers would be the tax havens that host the headquarters of multinationals.

The reactions were not long in coming after the publication of the OECD initiative. In France, the Ministry of Finance has welcomed "this promising work base". "We want this discussion to provide the necessary political momentum" to reach a global agreement.

On the other hand, the NGO Oxfam declared itself disappointed. "It's a mountain that has given birth to a mouse," said Quentin Parrinello, an expert on these tax issues, who described the OECD proposal as "extremely complex".

"We are going to take modest money from tax havens to give it back to the rich countries, there is a real problem of justice in this solution," he said.

For its part, Amazon called this proposal "an important step forward" and renewed its support for the work of the OECD.

In an interview with Les Echos last week, Apple CEO Tim Cook also wanted the taxation of multinationals "to be decided at the OECD level."

arz / ak / cbn

© 2019 AFP

Source: france24

You may like

News/Politics 2019-12-02T11:19:52.211Z

Trends 24h


news 2020/02/19    

© Communities 2019 - Privacy