Global tax deal finally finds agreement as Ireland, Estonia & Hungary drop objections



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Global tax deal finally finds agreement as Ireland, Estonia & Hungary drop objections

On Friday, a group of 136 OECD (Organization of Economic Co-operation and Development) member countries had agreed to a minimum global tax rate of 15.0 per cent for blue-whale multinational business groups, largely aimed at making it harder for heavy-weight conglomerates to avert taxation by registering HQs in low-tax safe-haven nations, while US President Joe Biden had welcomed the deal as well despite the scale of damage a barrage of US-based multinational businesses would have to bear as a repercussion to a sweeping reform in global tax rules.

Biden was quoted saying shortly after reaching an accord over a global tax rate of 15.0 per cent with Dublin, Budapest alongside Tallinn dropping their oppositions off the table, that, the deal had metamorphosized a level-playing ground.

Nevertheless, it still remains to subject to deep discontent on whether such a swift reform on global tax rules could be reached without existence of a pandemic that had toiled trillions from advanced economies in stimulus alongside other measures over past one year and a half, suggested analysts.

In point of fact, latest accord on global tax rule had been an expensive harvest of years of negotiations that had witnessed a number of trade rows among nations over taxation on multinational business entities, while a latest reform in global taxation would likely to wind up a four-decade-long dash for a deluge of entities seeking a tax-haven state, as the latest overhaul targets to set up a base-level for countries who had been on the lookout of being a tax-haven nation in bids to draw in havoc-scale investments alongside jobs.

Global tax reforms finally witness a dawn

Apart from that, followed by the agreement, Joe Biden said in a separate statement, “Establishing, for the first time in history, a strong global minimum tax will finally even the playing field for American workers and taxpayers, along with the rest of the world.

” Nonetheless, out of 140 member countries involved in the deal, 136 had voted in favour of a global-scale tax of 15.0 per cent, which is still much lower than a tax of 23.5 per cent in industrialized countries, though, Kenya, Nigeria, Sri Lanka and Pakistan abstained from voting.