The World Economic Forum (WEF) has published a white paper identifying the global minimum corporate tax rate and a UN tax convention as key policy pathways for ambitious economic recoveries post-pandemic. Reacting to the white paper, which references the Tax Justice Network’s research, Alex Cobham, chief executive at the Tax Justice Network said:
“We’re delighted to see WEF join the growing consensus around the recommendations of the high-level UN FACTI panel on how to replace failing global tax rules set by the OECD. The WEF hasn’t just identified a global minimum tax rate as a crucial tool for economies’ recovery post-pandemic, but has specifically drawn attention to the importance of implementing a global tax rate under the more balanced METR proposal instead of the OECD proposal.
“The METR (Minimum Effective Tax Rate)1 proposal recovers more underpaid tax from multinational corporations and spreads it more fairly among countries. Economically, morally, logistically, the METR proposal is the superior way to implement a global minimum corporate tax rate.2 The fact that the less effective, more complicated and grossly unfair proposal put forward by the OECD is even being considered in face of a far better alternative only goes to show how inappropriate it is for our global tax rules to be set by the club of rich countries and tax havens at the OECD.
“WEF is right to support the call for a UN tax convention to inclusively and meaningfully bring an end to the race to the bottom. Under the OECD proposal, the G7 countries – which account for 10% of the world’s population – would capture more than 60% of the additional revenues. The G7 meeting this weekend could set the course for an ambitious minimum tax rate with a fair share of revenues for all – or they could confirm that they are only looking out for their own narrow interests, even during a worldwide pandemic. That would underscore how right the World Economic Forum is to join the calls for a globally inclusive process at the UN, to ensure that global corporate tax rules are genuinely democratic and principled on our human rights.”
Contact the press team: media [@] taxjustice [.] net
Notes to Editor
- An explanation of the METR (Minimum Effective Tax Rate) proposal by Sol Picciotto, Coordinator of the BEPS Monitoring Group, emeritus professor of law at the University of Lancaster in the UK and Tax Justice Network senior adviser, is available here.
- Our analysis of how much each country can recover in underpaid corporate tax under a global minimum corporate tax applied under the OECD proposal vs the METR proposal is available here. You can view the country figures in this table here.