“This is a very important step” in global reform, he said.
To reach a compromise, the text of the agreement was amended to now refer to a minimum effective corporate tax rate of 15%, instead of “at least 15%”, a formulation that Dublin opposed because it left the open door to be forced by other countries to apply a higher rate.
This has been one of the last key steps in a great global tax reform that gained momentum with the arrival to the White House of the Democratic president Joe Biden.
After months of stagnation, Irish leaders, whose country has one of the lowest corporate taxes in the world, 12.5%, issued a series of statements on Wednesday suggesting the proximity of a compromise.
The landmark agreement, announced in July under the aegis of the Organization for Economic Cooperation and Development (OECD) and signed by 134 countries, provided for the imposition of an effective rate of “at least” 15% to multinationals with a turnover of 750 million euros (860 million dollars) or more.
Among them are many large American technology groups, such as Facebook or Google, which set up their European headquarters in Ireland attracted by its low taxation.
Donohoe welcomed Thursday’s deal, saying it provides “security” and allows Dublin to remain “an attractive destination” for businesses.
By signing this commitment, Dublin calls into question its low-tax economic model, which has allowed it to attract many multinationals, especially among the technological and pharmaceutical giants.
At a time when countries around the world are seeking funds to straighten out their public finances battered by the pandemic, This reform aims to fight against tax evasion by multinationals, largely American, that are registered in countries with lower tax rates.
The NGO Oxfam regretted, however, that “what could have been a historic agreement to end the era of paradises prosecutors It ends up being a patch for the benefit of rich countries. “
“The proposal for tax levels of 15% (minimum percentage) will benefit rich countries and increase inequalities. G7 and the Union European Two-thirds of these tax revenues will recover, but only 3% of the poorest countries, although they represent more than a third of the world’s population, “lamented Susana Ruiz, head of fiscal policies at Oxfam.
This global tax reform is scheduled to come into effect before 2023.
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