Yellen says global minimum tax needed, too soon to declare victory over pandemic

By David Lawder (Reuters) - U.S. Treasury Secretary Janet Yellen said on Monday that she is working with G20 countries to agree on a global corporate minimum tax rate to end a '30-year race to the bottom on corporate tax rates.' The global minimum tax is a key pillar of President Joe Biden's $2 trillion infrastructure spending plan, which calls for an increase in the U.S.

Reuters April 06, 2021 00:06:38 IST
Yellen says global minimum tax needed, too soon to declare victory over pandemic

Yellen says global minimum tax needed too soon to declare victory over pandemic

By David Lawder

(Reuters) - U.S. Treasury Secretary Janet Yellen said on Monday that she is working with G20 countries to agree on a global corporate minimum tax rate to end a "30-year race to the bottom on corporate tax rates."

The global minimum tax is a key pillar of President Joe Biden's $2 trillion infrastructure spending plan, which calls for an increase in the U.S. corporate tax rate to 28%..

Without a global minimum, the United States would again be at a disadvantage to a number of other major economies with lower tax rates, tax experts say, with U.S. commitment helping to jump start negotiations for a tax deal among a number of major economies.

Yellen, speaking to the Chicago Council on Global Affairs, said she also would use her participation in International Monetary Fund and World Bank annual meetings this week to advance discussions on climate change, improve vaccine access and encourage countries to support a strong global recovery.

The new Treasury chief said it was important to "end the pressures of tax competition" and make sure governments "have stable tax systems that raise sufficient revenues in essential public goods and respond to crises, and that all citizens fairly share the burden of financing government."

Separately, a U.S. Treasury official told reporters that it was important to have the world's major economies on board with a global minimum tax to make it effective.

The official said the United States would use its own tax legislation to prevent companies from shifting profits or residency to tax haven countries and would encourage other major economies to do the same.

The Biden plan proposes a 21% minimum corporate tax rate, coupled with eliminating exemptions on income from countries that do not enact a minimum tax. The administration says the plan will discourage the shifting of jobs and profits overseas.

Yellen said in her remarks that while advanced economies had successfully supported their economies through the COVID-19 pandemic, it was too early to declare victory, and more support for low income countries to gain access to vaccines was needed.

"I am urging our partners to continue a strong fiscal effort and avoid withdrawing support too early, to promote a strong recovery and help avoid the emergence of global imbalances.

(Reporting by David Lawder in Washington and Bhargav Acharya in Bengaluru; Editing by Emelia Sithole-Matarise, Andrea Ricci and Chizu Nomiyama)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

Jailed Kremlin critic Navalny goes on hunger strike over lack of medical care
World

Jailed Kremlin critic Navalny goes on hunger strike over lack of medical care

By Anton Zverev and Andrew Osborn MOSCOW (Reuters) - Jailed Kremlin critic Alexei Navalny went on hunger strike on Wednesday in an attempt to force the prison holding him outside Moscow to provide him with proper medical care for what he said was acute pain in his back and legs. The fate of Navalny, one of President Vladimir Putin's most prominent critics, is in focus after he said last week that being woken up by a guard every hour during the night amounted to torture and that his appeals for medical treatment had been ignored. In a handwritten letter addressed to the governor of his prison which was posted to social media by his team on Wednesday, Navalny said daily requests for a doctor of his choice to examine him and for proper medicine had been ignored

Gbabgo could return to Ivory Coast after ICC upholds acquittal
World

Gbabgo could return to Ivory Coast after ICC upholds acquittal

By Stephanie van den Berg THE HAGUE (Reuters) - The International Criminal Court on Wednesday upheld its 2019 acquittal of former Ivory Coast President Laurent Gbagbo on charges of crimes against humanity during post-election violence and ordered all conditions of his release be removed. The decision may open the way for Gbagbo, 75, who has been living in Belgium, to return to Ivory Coast

Iconic French sports stadium prepares to be vaccination centre
World

Iconic French sports stadium prepares to be vaccination centre

SAINT-DENIS, France (Reuters) - The French stadium that hosted World Cup finals in soccer and rugby is taking on a new role in response to the COVID-19 pandemic: it is becoming a vaccination centre. Workers at the Stade de France venue were on Wednesday putting up tents for use as vaccination cubicles inside a hall in the bowels of the stadium that in pre-pandemic times was used to host conferences and VIP receptions. The Stade de France is due to host the French soccer cup final in May, the final of the domestic rugby competition in June, and a concert by U.S.