G7 and Trump: Global Tax or American Compromise?
The G7 countries have finally reached an agreement on a global corporate minimum tax, but not quite how you might have expected. Big American companies are exempted from this tax! Yes, you read that right – while the world tries to fight tax havens and tax evasion, the G7 decided to spare American giants.
What happened?
The Canadian government, currently chairing the G7, announced that profits of American companies, whether domestic or foreign, will be taxed only in the United States. This move came after US President Donald Trump threatened to impose retaliatory tariffs and taxes if the global tax was implemented to the detriment of American firms.
Trump’s ultimatum and the compromise
In January, Trump issued a decree blocking the global minimum corporate tax agreement, hailed as a breakthrough in fighting tax evasion. However, now a compromise has been reached – American companies are exempted, and the US promised not to stand in the way of the global tax. In return, Trump agreed to remove a controversial provision of the tax law that provided for retaliatory measures.
Reactions and consequences
German finance researcher Lars Klingbajl stated that this agreement opens the way for the global introduction of a minimum corporate tax and the fight against tax havens. British Finance Minister Rachel Reeves welcomed the agreement but warned that the fight against aggressive tax avoidance strategies must continue.
What does this mean for the world?
This deal is far from ideal. While the global community tries to stop the race to the lowest tax rates, American corporations have received special treatment. Billions of dollars are lost due to tax evasion and avoidance, and it is now clear that the US will protect its giants at all costs.
Conclusion
Is this the right path to fair global taxation or just another example of powerful countries protecting their interests? As the world watches, the G7 has made a compromise that will anger many. What do you think about this deal? Did Trump manage to dodge a real global tax, or is this just the beginning of the fight? Drop a comment, let your voice be heard!
Source: Blic, Index
