Politics

130 countries establish global minimum for corporate tax

The historic agreement is expected to raise around $150bn (£108bn) every year. Source: Penn State (via Flickr)
As part of a move which will have a significant economic impact, 130 countries, making up more than ninety percent of the world's economy, have signed up to a plan to establish a global minimum for corporate tax at fifteen percent.

By Tom Kingsbury | Head of Politics

The agreement was made at the Organisation for Economic Co-operation and Development (OECD) in Paris, building on earlier talks at a G7 summit in June.

According to the OECD, the current plan is expected to raise around $150bn (£108bn) every year, and is set to be implemented by 2023.

Although nine of the 139 countries involved did not sign up to the global tax plan, negotiations are expected to continue in the lead up to the October G20 leaders’ meeting in Rome.

The countries that took exception to the broad agreement include Ireland, Estonia, Hungary, Barbados, Kenya, Nigeria, Sri Lanka, St Vincent, the Grenadines and Peru (which chose to abstain since it currently lacks a government to make a decision regarding the plan). 

Switzerland, the Bahamas, the Cayman Islands and Gibraltar all agreed to back the plan, despite previously being labelled as ‘tax havens’ – Countries in which companies may choose to base themselves in return for lower taxes despite operating elsewhere.

All the leading nations part of the G20 have supported the deal, following lobbying by the US, but will have to implement their own policies in their respective countries. This may prove difficult for the US government, which seems set to face resistance from some Republican lawmakers, who feel it may cost the US investment and jobs.

How will the tax work, and why have it?

The plan will establish a minimum tax rate of 15 percent for many of the world’s largest companies, and is designed to make sure these multinational corporations do not avoid taxation by basing themselves in so-called ‘tax havens’, where the corporate tax is minimal.

As a result, the countries where these companies most frequently operate will receive greater proportions of the taxes, regardless of where the companies base themselves.

From 2023, multinational corporations with a turnover greater than €20bn (£17bn) will face the minimum corporate tax, with the threshold to be lowered to €10bn seven years later.

Amazon will be included within the framework of the plan despite a profit margin that does not qualify it for the tax. This is likely because Amazon avoids taxation by carrying forward losses from years when it was not profitable and effectively hiding current profits from the tax system by investing them into research and development, along with other methods.

The 15 percent rate is still lower than most OECD countries’ domestic rates, and will only lift the taxes within countries that have been considered ‘tax havens’ in the past.

The rules will also not apply in certain circumstances – For example, they will not affect tax incentives for corporate investment in areas such as manufacturing and regulated services like oil and gas.

Shipping will also be an exempt area, since shipping companies operate beyond national borders.

Part of the reason for the plan is to bring an end to the perceived ‘race to the bottom’ on corporate tax, an idea suggesting corporate tax has been being pushed down for decades, with governments competing for the business of multinational corporations by offering lower and lower corporate tax rates.

The minimum rate will reduce the amount of pressure companies can exert on governments by threatening to leave the country if tax rates are raised, and will allow governments to collect taxes from companies operating in their country even if they base themselves elsewhere.

What did officials say about the plan?

The OECD Secretary General Mathias Cormann has said the plan will ensure that “large multinational companies pay their fair share of tax everywhere”.

He noted that it did not mean an end to tax competition – “but it does set multilaterally agreed limitations on it.”

US President Joe Biden echoed the sentiments, stating: “With a global minimum tax in place, multinational corporations will no longer be able to pit countries against one another in a bid to push tax rates down and protect their profits at the expense of public revenue.”

German finance minister Olaf Scholz called the global plan a “colossal step towards more tax justice”, and Rishi Sunak, the UK’s Chancellor of the Exchequer, said it would make sure “multinational tech giants pay the right tax in the right countries”.

US Treasury secretary Janet Yellen stated: “the race to the bottom is one step closer to coming to an end”, and the OECD said the plan would add “much-needed certainty and stability to the international tax system”.


Cyfieithiad Cymraeg Gan Nel Richards | Pennaeth Taf-od

Gwnaed y cytundeb yn y Sefydliad ar gyfer Cydweithrediad a Datblygiad Economaidd (OECD) ym Mharis, gan adeiladu ar drafodaethau cynharach mewn uwchgynhadledd G7 ym mis Mehefin.

Yn ôl yr OECD, disgwylir i’r cynllun presennol godi tua $150bn (£108bn) bob blwyddyn, a bydd yn cael ei weithredu erbyn 2023.

Er nad oedd 9 o’r 139 o wledydd dan sylw wedi ymuno â’r cynllun treth byd-eang, disgwylir i’r trafodaethau barhau yn y cyfnod cyn cyfarfod arweinwyr yr G20 ym mis Hydref yn Rhufain.

Mae’r gwledydd a oedd yn eithriad i’r cytundeb cyffredinol yn cynnwys Iwerddon, Estonia, Hwngari, Barbados, Kenya, Nigeria, Sri Lanka, St Vincent, y Grenadines a Pheriw (a ddewisodd ymatal gan nad oes gan y wledydd yma lywodraeth ar hyn o bryd i wneud penderfyniad ynglŷn â’r cynllun).

Cytunodd y Swistir, y Bahamas, Ynysoedd y Cayman a Gibraltar i gefnogi’r cynllun, er iddynt gael eu labelu’n flaenorol fel ‘hafanau treth’ (‘tax havens’)- Gwledydd lle gall cwmnïau ddewis eu hunain yn gyfnewidiol am drethi is er gwaethaf gweithredu mewn mannau eraill.

Mae holl brif wledydd y G20 wedi cefnogi’r fargen, yn dilyn lobïo gan yr Unol Daleithiau, ond bydd yn rhaid iddynt weithredu eu polisïau eu hunain yn eu gwledydd priod. Gall hyn fod yn anodd i lywodraeth yr Unol Daleithiau, sy’n ymddangos fel pe bai’n wynebu gwrthwynebiad gan rai o gyfreithwyr ailbubi, sy’n teimlo y gallai gostio buddsoddiad a swyddi i’r UD.

Sut y bydd y dreth yn gweithio, a pham?

Bydd y cynllun yn sefydlu cyfradd dreth isaf o 15% ar gyfer llawer o gwmnïau mwya’r byd, ac mae wedi’i chynllunio i sicrhau nad yw’r corfforaethau amlwladol hyn yn osgoi trethiant drwy seilio eu hunain mewn ‘hafanau treth’ fel eu gelwir, lle mae’r dreth gorfforaethol yn isel iawn.

O ganlyniad, bydd y gwledydd lle mae’r cwmnïau hyn yn gweithredu amlaf yn cael cyfraniadau uwch o’r trethi, ble bynnag mae’r canolfannau y cwmnïau wedi’u selio. 

O 2023 ymlaen, bydd corfforaethau amlwladol sydd â throsiant sy’n fwy na €20bn (£17bn) yn wynebu’r dreth gorfforaethol isaf, gyda’r trothwy i’w ostwng i €10bn saith mlynedd yn ddiweddarach.

Bydd Amazon yn cael ei gynnwys o fewn fframwaith y cynllun er nad yw ei helw yn gymwys ar gyfer y dreth hon Mae hyn yn debygol oherwydd bod Amazon yn osgoi trethiant drwy gario colledion ymlaen o flynyddoedd pan nad oedd yn broffidiol ac yn cuddio’r elw presennol o’r system dreth yn effeithiol drwy eu buddsoddi mewn ymchwil a datblygu, ynghyd â dulliau eraill.

Mae’r gyfradd o 15% yn dal yn is na chyfraddau domestig y rhan fwyaf o wledydd yr OECD, ac ni fydd hyn ond yn codi’r trethi o fewn gwledydd sydd wedi cael eu hystyried yn ‘hafanau treth’ yn y gorffennol.

Ni fydd y rheolau’n berthnasol mewn rhai amgylchiadau ychwaith – Er enghraifft, ni fyddant yn effeithio ar gymhellion treth ar gyfer buddsoddiad corfforaethol mewn meysydd fel gweithgynhyrchu a gwasanaethau rheoleiddiedig fel olew a nwy.

Bydd llongau hefyd mewn sefyllfaeithriedig, gan fod cwmnïau llongau yn gweithredu y tu hwnt i ffiniau cenedlaethol.

Rhan o’r rheswm dros y cynllun yw dod â’r ‘ras i’r gwaelod’ i ben ar dreth gorfforaethol, syniad sy’n awgrymu bod treth gorfforaethol wedi cael ei wthio i lawr ers degawdau, gyda llywodraethau’n cystadlu am fusnes corfforaethau amlwladol drwy gynnig cyfraddau treth gorfforaethol is ac is.

Bydd y gyfradd isaf yn lleihau faint o bwysau y gall cwmnïau ei roi ar lywodraethau drwy fygwth gadael y wlad os codir cyfraddau treth, a bydd yn caniatáu i lywodraethau gasglu trethi gan gwmnïau sy’n gweithredu yn eu gwlad hyd yn oed os ydynt yn seilio eu canolfannau mewn mannau eraill.

Beth ddywedodd y swyddogion am y cynllun?

Mae Ysgrifennydd Cyffredinol yr OECD Mathias Cormann wedi dweud y bydd y cynllun yn sicrhau bod cwmnïau rhyngwladol mawr yn talu eu cyfran deg o dreth ym mhobman.

Nododd nad oedd yn golygu diwedd ar gystadleuaeth treth – “ond mae’n gosod cyfyngiadau y cytunwyd arnynt yn amlochrog arno.”

Ategodd Joe Biden, Llywydd yr Unol Daleithiau, y teimladau, gan ddweud: “Gydag isafswm treth fyd-eang ar waith, ni fydd corfforaethau amlwladol bellach yn gallu rhoi gwledydd yn erbyn ei gilydd mewn ymgais i wthio cyfraddau treth i lawr a diogelu eu helw ar draul refeniw cyhoeddus.”

Galwodd gweinidog cyllid yr Almaen Olaf Scholz y cynllun byd-eang yn “gam enfawr tuag at fwy o gyfiawnder treth”, a dywedodd Rishi Sunak, Canghellor y Trysorlys y DU, y byddai’n sicrhau bod cewri technoleg amlwladol yn talu’r dreth gywir yn y gwledydd cywir.

Dywedodd Janet Yellen, ysgrifennydd Trysorlys yr Unol Daleithiau: “mae’r ras i’r gwaelod un cam yn nes at ddod i ben”, a dywedodd yr OECD y byddai’r cynllun yn ychwanegu “sicrwydd a sefydlogrwydd y mae mawr eu hangen at y system dreth ryngwladol”.

Tom Kingsbury Politics

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