G20 Summit: Hammond Pushes for Digital Tax
G20 SUMMIT- British finance minister Phillip Hammond confirmed that he would call for the Group of 20 leading economies (G20) to set a global tax on the revenues of online giants such as Google, Facebook, and Amazon.
Hammond said he would press for a global digital tax that would toughen up the process for online firms to minimize their tax bills during the meeting, to which finance ministers and central bankers will meet on Saturday and Sunday in Japan.
“I will further strengthen our successful economic relationship by showcasing how we’re embracing the new economy and champion our world-class expertise in tacking the challenges posed by the digital revolution,” said Hammond.
“I will also meet with my G20 counterparts to reaffirm the need for global reform of the international corporate tax framework, to ensure it is fit for the future.”
Huge internet corporations claim that they comply with tax rules but have paid tax in Europe. They typically do that by channeling the sales via countries such as Ireland and Luxemburg, which have lax tax regimes.
Hammod said that he would also encourage the adoption of shared principles for global infrastructure investment. He would also meet India’s new finance minister Nirmala Sitharama for the first time to talk about ties after Brexit.
Hammond met with Japanese business leaders ahead of the G20 meeting. They talked about the concerns over what Brexit might mean for their investments in Britain.
Last year, Hammond said that he wanted a global tax but Britain was prepared to move on its own by taxing profitable companies at 2% on the money that they make from UK users from April 2020. This could help them raise more than 400 million pounds, or $12 million, every year.
Meanwhile, according to a draft of a joint statement by G20 finance chiefs, the group will pledge to accelerate the efforts to effectively collect taxes from multinational digital companies like Google and Facebook.
“We will continue our cooperation for a globally fair, sustainable, and modern international tax system, and welcome international cooperation to advance pro-growth tax policies,” said the draft communiqué.
- Trading Instrument
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