This archive report was first published on 2 July 2021.
July 1, 2021 - The Organization for Economic Co-operation and Development (OECD) has announced that 130 countries have agreed to a global tax reform, ensuring that multinationals pay their fair share wherever they operate.
The new tax regime will add some $150 billion to government coffers globally once it comes into force, which the OECD hopes will be in 2023.
US President Joe Biden hailed the deal as a significant step towards halting the 'race to the bottom' for corporate taxes, while Germany and France described it as a 'colossal step towards tax justice' and 'the most important tax agreement in a century', respectively.
However, EU low-tax countries Ireland and Hungary declined to sign up to the agreement, highlighting lingering divisions on global taxation.
OECD Secretary General Mathias Cormann said the package 'does not eliminate tax competition, as it should not, but it does set multilaterally agreed limitations on it', adding that it also accommodates the various interests across the negotiating table.
