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The G20 is targeting tech titans' tax havens

Credit: Reuters Studio
Published on June 8, 2019 - Duration: 01:35s

The G20 is targeting tech titans' tax havens

The world's 20 biggest economies are pushing ahead on common rules to close offshore tax loopholes for the likes of Facebook and Google.

If successful, it would be a rare consensus in the backdrop of multiple trade wars.

Matthew Larotonda reports.

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The G20 is targeting tech titans' tax havens

The world's 20 biggest economies appear set to move ahead on common regulations designed to block off offshore tax havens for the likes of Facebook, Amazon, Google, and other tech giants.

(SOUNDBITE) (English) BRITISH FINANCE MINISTER PHILIP HAMMON SAYING: "The rules don't require them to pay any taxes." (SOUNDBITE) (English) JAPANESE FINANCE MINISTER TARO ASO, SAYING: "(...) pose particular tax challenges." (SOUNDBITE) (English) U.S. TREASURY SECRETARY STEVEN MNUCHIN, SAYING: "Sounds like we have a strong consensus." Government finance chiefs are meeting at this year's G20 summit in Japan.

A draft of a joint statement from them, seen by Reuters, includes an agreement for a global minimum tax rate for digital services and a way to divide taxes even in cases where companies don't have a physical presence in a country.

If successful, it would represent a rare moment of unity for these officials, in the sense that Europe, Japan, and China all find themselves in trade disputes of varying severity with the United States.

Now it would seem they've found a common foe.

Many of the largest tech companies have faced criticism for cutting their tax contributions significantly, by channeling profits through countries with very low tax rates such as Ireland and Luxembourg.

These officials aren't in complete agreement, though.

U.S. Treasury Secretary Steven Mnuchin is concerned that American companies may be unfairly targeted.

Meanwhile, there is no indication of any progress at this summit regarding the biggest trade dispute: The U.S.-China trade war.

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