UK Labor Party pushes to vote on US minimum corporate tax plan

Keir Starmer, leader of Britain’s opposition Labor Party, debates Prime Minister Boris Johnson behind protective glass during Question Period in the House of Commons in London, Britain April 28, 2021. UK Parliament/ Jessica Taylor/Handout via REUTERS

LONDON, May 23 (Reuters) – Britain’s main opposition Labor Party said it would push for a vote in parliament on Monday on backing U.S. plans to introduce a global minimum corporate income tax rate. companies.

The US Treasury Department said earlier this week that it would accept a floor of at least 15% in international negotiations, a rate significantly lower than the proposed minimum of 21% for US multinationals.

The 21% Global Low-Tax Income Tax (GILTI) rate proposed by the Biden administration, aimed at capturing income shifted by corporations to tax havens, was widely seen as a point starting point for further OECD discussions on a global minimum tax.

While France and Germany backed 21%, other countries pushed for a lower rate, with previous OECD discussions on the subject having centered around 12.5%, the same rate practiced. by Ireland.

Britain will raise its main corporate tax rate to 25% from 19% in 2023, Finance Minister Rishi Sunak announced earlier this year. Read more

Labor table an amendment to the Finance Bill.

“This global pact will bring in extra taxes to benefit Britain, while preventing huge multinationals and online giants from undermining our businesses,” said Labor finance spokeswoman Rachel Reeves.

The UK Treasury said that reaching an international agreement on how big digital companies are taxed “is a priority” and that “we welcome the renewed commitment of the United States to tackle the problem and agree that taxes minimums could help ensure businesses pay taxes.”

“However, it is also important to know where the tax is paid and any agreement must ensure that digital companies pay tax in the UK that reflects their economic activities.”

Reporting by Costas Pitas; Editing by Jan Harvey

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