Rishi Sunak is blocking support for Joe Biden’s bid to reduce the 21 business tax on the world, while Britain is urging the US to ensure that all agreements include better ways to impose energy giants.
The chancellor, who sits in the G7 cabinet, said he would see less money around the world as part of the deal, with finance officials fearing Biden wanted to force technology companies to pay taxes in California when they have to pay in the UK.
Sunak was forced by Labor to agree US system of 21 percent international taxes. Lisa Nandy, a foreign secretary, claimed that Britain was showing a delay, not leadership.
But a chancellor’s aide said Biden’s proposal would support Washington, which wants a first-round deal on global taxation, not because the US president wants too. raise the prices of home corporations up to 25-28%.
British officials fear the US will not want to accept extremes the shaking of tax laws around the world – which began in the 1920s – a demonstration of how foreign countries sell, rather than being available groups.
The UK was concerned that even if Biden’s management agreed to a global agreement, it could remain failure in Congress, leaving the UK high and dry.
Negotiations on global tax reform are taking place in the OECD and the G20, and the issue is set to come as G7’s finance ministers meet in London on June 4.
Speaking at an online conference at Oxford University’s Center for Business taxation, Mike Williams, director of the Treasure of business and taxation, said a deal that only looks at global taxes is not politically acceptable.
“The ultimate goal of the UK is to eliminate digital taxes, which we have been working on for years,” he said.
Britain has released his digital sales tax, which is expected to raise about $ 500m a year from major US companies by 2024-5.
“It’s not just about low taxes,” Williams said. “Lower taxes can help – as long as they work – to ensure businesses pay their taxes, but they also need to pay taxes.”
“When it comes to providing Coventry children’s schools, it doesn’t really matter if taxes can be paid in California when they have to be paid in the UK,” he added.
But Britain is ready to make any deal possible both pillars of Biden’s plan restructuring of international taxes: global tax and lower international taxes.
The Chancellor told a meeting of the Wall Street Journal CEO last week that digital taxes were a priority in the UK: “I want to find a way to pay higher taxes to big companies around the world.” He has promised to abolish Britain’s digital sales tax if the international agreement is approved.
Sunak also said that 21% of corporate taxes were “higher than in previous negotiations”, but he was open to negotiations. Ireland, with a headline of 12.5%, is strongly opposed; Sunak has been established in raise the volume of the UK to 25% in 2023.
Nandy said Biden’s contribution to the global tax system represents a unique opportunity. He is working with Rachel Reeves, the shadow chancellor, to press Sunak to address the issue at next month’s G7 summit in Cornwall. “We have to avoid competition until the end,” he said.
Robert Palmer, head of the Justice UK campaign group, called on the UK to support Biden’s views, saying what was happening “was not good” for the government. dealing with taxes.
Although the agreement on the table was “not perfect”, 21% of global taxes could be “game-changing” by preventing companies from paying “very low” taxes, he said.