World leaders push big companies to pay more taxes
ST. PETERSBURG, Russia — It’s time to make Google, Apple and other multinational companies pay more taxes.
That’s the message President Barack Obama and the leaders of the world’s leading economies sent today to cross-border giants at a summit ending today.
The new rules on taxes would make it harder for companies to hide profits in tax havens and force them to pay tax in the countries where they make money. The G-20 leaders also agreed to an unprecedented deal to share information on individual taxpayers, despite earlier resistance by China.
Low tax payments by major global companies such as Google or Amazon have sparked public anger in Europe which is struggling to emerge from recession.
The G-20 leaders said they will seek recommendations to set up a system so that profits would be taxed “where economic activities deriving the profits are performed and where value is created.”
The leaders also said that they expect to begin exchange information automatically on tax matters among G20 members by the end of 2015.
But it may take more years to get the new tax treaties and laws in place.
British Prime Minister David Cameron said that the new tax rules stipulate that not only advanced nations will sign on the deal but said it’s important that “developing countries have to participate in sharing tax regulation.”
The group is designing the new global tax rules and has come under fire from cross-border corporations that say they’re being unfairly targeted.
But officials say some companies are starting to recognize that their moves to register in low-tax jurisdictions such as Luxembourg or the Cayman Islands are causing public pain.
