The Summit of the countries with the largest economies in the world (G20 Summit) agreed on a minimum tax rate on the profits of global giant companies of 15 percent. The policy was agreed in line with the concerns of many tax regulators in countries around the world about the possibility of global giant companies failing to pay their tax obligations. This is made possible by the existence of countries that set tax rates that tend to be lower than other countries. Reporting from the BBC, the agreement of the G20 leaders, including Indonesia, is contained in the draft conclusion of the G20 summit meeting October 30-31, 2021, which will be held in Rome, Italy. An agreement on a minimum tax rate for the global giant was originally proposed by the United States. Later, the minimum tax rate for the global giant company will begin to be implemented in 2023
United States Treasury Secretary Janet Yellen said the agreement between the G20 member countries was a historic moment for the global economy. In addition, the minimum global corporate tax rate of 15 percent will also end various efforts by global corporations to evade their tax obligations. Through her Twitter account, Yellen also said that the results of the agreement of the G20 leaders will also be beneficial for businesses and workers in the United States, although on the other hand, many giant companies based in the US will be affected by this policy. Reporting from Al-Jazeera, United States President Joe Biden called the G20 agreement on the minimum tax rate for global giant companies a game changer or a new breakthrough.
"Here, the G20 leaders, who represent 80 percent of the world's GDP, clearly support global minimum tax rates," Biden tweeted. "This is more than just a tax deal, it is a form of diplocation to reshape the world economy and channel it to our people," he said.
These tax policies are part of reform plans for more than 140 countries. The policy is expected to encourage multinational companies, including Google, Amazon, Facebook, Microsoft, and Apple to avoid paying taxes by establishing headquarters in low-tax jurisdictions. On the other hand, this policy is expected to end the decades-long competition in tax rates between countries to attract foreign investment.
