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G7 deal will likely raise taxes for tech giants like Apple and Google | Engadget

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G7 deal will likely raise taxes for tech giants like Apple and Google | Engadget

Tech giants are actually more likely to pay extra taxes after years of breaks. BBC Information experiences that the G7 international locations have struck a deal that may have multinationals like Apple, Amazon and Google pay extra tax. The brand new settlement would have corporations pay extra taxes the place they function so long as they’ve a minimal 10 p.c revenue margin, with a tax on 20 p.c of any revenue above that determine. There would even be a minimal company tax fee of “at the least” 15 p.c to forestall international locations from serving as tax havens.

There’s an understanding that this may substitute the digital service taxes in international locations just like the UK, in accordance with US Treasury Secretary Janet Yellen.

Amazon and Google each claimed to have welcomed the association as a modernization, with Amazon saying it will add “stability” to worldwide tax.

The transfer might increase the baseline tax fee for tech corporations which have relied on havens in Eire and different international locations to reduce their bills. That will please international locations which have lengthy accused the tech business of depriving them of much-needed income, notably throughout the COVID-19 pandemic. Corporations have been bracing for will increase like this for some time, however the G7 pact makes these hikes extra doubtless and constant.

Simply when and the way these modifications would come about is one other matter. The settlement will undergo a bigger dialogue at a G20 assembly in July, and there isn’t any assure these additional international locations (together with China and Russia) will comply with it. There’s additionally the matter of timing — it might take years for international locations to reshape their tax legal guidelines. Nonetheless influential the G7’s announcement may be, it is simply the beginning of an extended journey.

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