In response to the statement, Tove Maria Ryding, Tax Coordinator at the European Network on Debt and Development (Eurodad), said:

“The statement by the Inclusive Framework follows the outline that has already been decided by the G7. The new global tax system that is now taking form looks highly complex, deeply unfair and full of loopholes. It seems multinational corporations will still have plenty of options for lowering their tax payments, and the rich countries will be privileged when taxing rights are divided between jurisdictions. With a minimum corporate tax rate as low as 15 per cent, we are also likely to see the global average corporate tax rate continue to drop.

“This is a rich countries’ deal, and it is very evident that governments are not participating on an equal footing. Developing countries have been invited to a table where the menu has already been set by the G7.

“The OECD and G7 have outlined a deal that fails to address the fundamental problems. One remarkable aspect of the new rules is that they’re designed as an extra layer on the existing system, and only applies to the world’s largest corporations. For the vast majority of the world’s multinational corporations, the system will remain largely unchanged. The existing corporate tax system has proven to be deeply dysfunctional and has already cost governments hundreds of billions of dollars in lost tax income. What we need is fundamental reform, instead of the sticking-plaster solutions that are now being discussed. A coalition of developing countries have put forward a proposal for a much more ambitious reform, but this has been largely ignored in the negotiations.

“We’re in the midst of a global crisis, and in urgent need of a new effective and fair corporate tax system, which will effectively combat inequalities within and between countries and mobilise resources for recovery and sustainable development. It is clear that the OECD-led negotiations will not deliver what we need. It is high time to initiate a truly global tax negotiations under the United Nations, where all countries can participate on an equal footing.”

ENDS

Media contact: Julia Ravenscroft, Communications Manager, Eurodad: [email protected]/ +32 486356814.

Note to editors

Eurodad’s reaction to last months’ G7 tax agreement can be found here: https://www.eurodad.org/eurodad_reaction_to_g7_finance_ministers_tax_deal