The Organization for Economic Cooperation and Development (OECD) is hoping to finalize an agreement this month among140 countries on a global tax overhaul to address how “consumer-facing” digital giants like Apple, Google, Facebook and Twitter are taxed in countries where they have users.
“I’m quietly optimistic that in time for the G-20 leaders summit at the end of October we will be in a position to finalize an agreement,” OECD Secretary General Mathias Cormann said. “A lot of work has been done; we are very close.”
The OECD wants to finalize the agreement soon and implement it by 2023. The plan gained considerable steam after Biden administration officials negotiated a compromise that would apply new global tax rules to no more than 100 large multinational corporations. The plan would set a minimum tax rate of at least 15% to prevent companies from relocating to low-tax havens and establish a system for sharing some of the profit imposed from taxing large multinationals based on where they operate, not where they’re headquartered.
U.S. Secretary of State Antony Blinken, who is in Paris for OECD-led meetings today, said he is optimistic about reaching consensus.
“I share the quiet optimism,” Blinken said. “We still have some work to do, but I think we made good progress in the last couple of days and we want to bring this over the finish line.”
If an agreement is reached this year, the U.S. could need bipartisan support in the Senate to approve U.S. cooperation.