Governments could slap multinational companies with precautionary levies if they refuse to respect a future global tax rate.
The Organisation for Economic Co-operation and Development today proposed a withholding tax as a means to encourage firms to apply a minimum rate, which remains to be decided. It outlined the plan in a consultation document calling for comments from the public until December 2.
The minimum rate is part of a global drive to ensure companies pay their fair share in dues and stop them from shifting profits to countries with low or no corporate tax.
Countries including France have repeatedly criticized tech companies such as Facebook and Google for dodging its taxes.
“A minimum tax rate on all income reduces the incentive for taxpayers to engage in profit shifting and establishes a floor for tax competition among jurisdictions,” the OECD said in a statement. “These rules would be implemented by way of changes to domestic law and tax treaties.”
The OECD plans to publish the final designRead More – Source