‘Historic’ global tax deal on multinationals delayed until 2024
An international deal that would force the world’s biggest multinational companies to pay a fair share of tax has been delayed until 2024 amid fresh wrangling over the painstakingly negotiated agreement.
Mathias Cormann, the secretary-general of the Organisation for Economic Co-operation and Development, told the World Economic Forum in Davos, Switzerland, that there were “difficult discussions” taking place that meant the deal could not come into force in 2023 as previously hoped.
Cormann said he remained confident an agreement would eventually be implemented to let countries levy more tax on the world’s largest firms based on the sales generated within their borders.
But the US billionaire investor, David Rubenstein, co-chairman of the Carlyle group, said he doubted whether the OECD-brokered deal would ever happen. “Global tax deals sound great but getting them implemented is very difficult,” he told a Davos session before Cormann’s comments.
The deal – which Cormann called “historic and very important” – has two parts. Pillar 1involves the reallocation of some profits from major multinationals such as US tech companies to countries where they made their sales, while Pillar 2 brings in a global minimum corporation tax rate of 15%.
Cormann said there were “still some difficult discussions under way with relation to the technical aspects” of Pillar 1.
“We deliberately set a very ambitious timeline for implementation to keep the pressure on and we think that has helped keep the momentum going.
“But I suspect it is probably most likely that we will end up with a practical implementation from 2024 onwards.”
Pillar 1 is facing opposition in the US Congress from Republican senators, and analysts have suggested the deal could fall if
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