G7 Proposes 15% Minimum Tax for Multinational Corporations

White House National Security Adviser Jake Sullivan said on Twitter Friday that G7 leaders meeting in Britain would endorse US President Joe Biden's proposal for a global minimum tax of at least 15% on multinational on corporations.

"America is rallying the world to get multinationals to pay their fair share so we can invest in our middle class back home," Sullivan tweeted.

https://twitter.com/JakeSullivan46/status/1403451392820494344?s=20

By supporting the move, major economies are aiming to discourage multinationals from shifting profits - and tax revenues - to low-tax countries regardless of where their sales are made.

The move comes as major economies aim to dissuade multinationals from shifting profits, and tax revenue, to low-tax countries "tax havens".

The current global tax date back to the 1920s and can't really stand against multinational giants who sell services remotely and attribute much of their profits to low-tax jurisdictions.

[caption id="attachment_245876" align="aligncenter" width="931"] U.S. President Joe Biden seen with world leader at the G7 summit in Cornwall, Britain, 11 June, 2021. (File Photo)[/caption]

Facebook and Amazon could take advantage of the agreement to create a minimum global tax rate of 15% on businesses if the final deal also eliminates increasingly common digital services taxes, according to Reuters.