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IMF boss: Tax deal must be simple with ‘few deviations’

While Chancellor Rishi Sunak has suggested City of London firms should be exempt from the global tax plan agreed at the G7, International Monetary Fund managing director Kristalina Georgieva has suggested such a move may not be the way to go, saying the global tax plan should strive for “few deviations” from the broad principle. G7 finance ministers have agreed to try and push through a global minimum corporation tax of 15%, while also outlining plans to target large multinationals and make them pay 20% corporation tax based on where their sales are. The Chancellor, who said the deal would get “the largest multinational tech giants to pay their fair share of tax”, has suggested that UK financial services firms should be exempt as the crackdown is aimed at US tech giants like Amazon and Facebook. However, Ms Georgieva says policies should “aim for simplicity”. She noted that developing countries have less capacity to administer tax, warning that anything that is more complicated “would create risks of derailing the purpose of generating more revenues to invest in health, education, infrastructure and the green transition”.

City A.M.

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