Latest news with #InclusiveFramework
Yahoo
a day ago
- Business
- Yahoo
G7 agrees to avoid higher taxes for US and UK companies
By Harshita Meenaktshi, Bipasha Dey and Promit Mukherjee (Reuters) -The United States and the Group of Seven nations have agreed to support a proposal that would exempt U.S. companies from some components of an existing global agreement, the G7 said in a statement on Saturday. The group has created a "side-by-side" system in response to the U.S. administration agreeing to scrap the Section 899 retaliatory tax proposal from President Donald Trump's tax and spending bill, it said in a statement from Canada, the head of the rolling G7 presidency. The G7 said the plan recognizes existing U.S. minimum tax laws and aims to bring more stability to the international tax system. The U.S Treasury Department said that following the removal of Section 899 from the U.S. Senate version of the tax and spending bill, there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting. "We look forward to discussing and developing this understanding within the Inclusive Framework," the Department said in a post on X on Saturday. UK businesses are also spared higher taxes after the removal of Section 899 from President Donald Trump's tax and spending bill. Britain said businesses would benefit from greater certainty and stability following the agreement. Some British businesses had in recent weeks said they were worried about paying substantial additional tax due to the inclusion of Section 899, which has now been removed. "Today's agreement provides much-needed certainty and stability for those businesses after they had raised their concerns," finance minister Rachel Reeves said in a statement, adding that more work was needed to tackle aggressive tax planning and avoidance. G7 officials said that they look forward to discussing a solution that is "acceptable and implementable to all". In January, through an executive order, Trump declared that the global corporate minimum tax deal was not applicable in the U.S., effectively pulling out of the landmark 2021 arrangement negotiated by the Biden administration with nearly 140 countries. He also vowed to impose a retaliatory tax against countries that impose taxes on U.S. firms under the 2021 global tax agreement. This tax was considered detrimental to many foreign companies operating in the U.S.
Mint
a day ago
- Business
- Mint
G7 back new side-by-side tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a "side-by-side" solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could "provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. "Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework," the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is "acceptable and implementable to all." Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States.
Mint
a day ago
- Business
- Mint
G7 back new side-by-side tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a "side-by-side" solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could "provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. "Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework," the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is "acceptable and implementable to all." Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States. He also threatened to impose a retaliatory tax on nations implementing the global tax rules against US firms, a move viewed as harmful to many foreign companies operating within the US. (ANI)
India Gazette
a day ago
- Business
- India Gazette
G7 back new 'side-by-side' tax proposal exempting American, UK firms from global tax rules
New Delhi [India], June 29 (ANI): US-parented companies will be exempted from certain elements of an existing global tax agreement according to a statement released by the Group of Seven countires which detailed the new proposal signed by the United States and its G7 partners. The agreement will see US companies benefit from a 'side-by-side' solution under which they will only be taxed at home, on both domestic and foreign profits, the G-7 said, in a statement released by Canada, which holds the group's rotating presidency. Earlier this year the US Secretary of the Treasury outlined the United States' concerns regarding the Pillar 2 rules agreed by the OECD/G20 Inclusive Framework on BEPS and set out a proposed 'side-by-side' solution under which US parented groups would be exempt from the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) in recognition of the existing US minimum tax rules to which they are subject. The side-by-side system could 'provide greater stability and certainty in the international tax system moving forward, including a constructive dialogue on the taxation of the digital economy and on preserving the tax sovereignty of all countries, the statement read. The US Treasury Department noted that with Section 899 removed from the Senate version of the bill, there is now a shared understanding that the side-by-side system could help maintain progress made by jurisdictions within the Inclusive Framework in combating base erosion and profit shifting. 'Following the removal of section 899 from the Senate version of the One, Big, Beautiful Bill, and consideration of the success of Qualified Domestic Minimum Top-up Tax implementation and its impact - there is a shared understanding that a side-by-side system could preserve important gains made by jurisdictions inside the Inclusive Framework in tackling base erosion and profit shifting and provide greater stability and certainty in the international tax system moving forward, the G7 announced. We look forward to discussing and developing this understanding within the Inclusive Framework,' the Treasury said in a post on X. The removal of Section 899 has also been welcomed by the United Kingdom. British businesses, which had recently voiced concerns about potentially facing higher taxes due to the measure, will no longer be subject to those risks. G7 officials echoed the importance of collaboration, expressing their commitment to pursuing a solution that is 'acceptable and implementable to all.' Earlier this year, through an executive order, Donald Trump declared that the 2021 global corporate minimum tax agreement--negotiated by the Biden administration and supported by nearly 140 countries--would not apply in the United States. He also threatened to impose a retaliatory tax on nations implementing the global tax rules against US firms, a move viewed as harmful to many foreign companies operating within the US. (ANI)
Time of India
a day ago
- Business
- Time of India
Global minimum tax: G7 endorses 'side-by-side' system replacing top-up levies; US, UK firms exempted
In a landmark development, the Group of Seven (G7) nations have agreed to exempt US-headquartered multinational corporations from key provisions of the global minimum tax agreement under a new "side-by-side" system. Tired of too many ads? go ad free now British businesses will also benefit from similar relief. As per news agency ANI, the new proposal, backed by the US and its G7 partners, will allow American firms to be taxed only domestically, on both foreign and local profits, rather than face additional top-up taxes overseas. The framework recognises existing US tax laws, specifically its domestic minimum tax, and offers a carve-out from the OECD's Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR). The G7 announcement, released by Canada, which currently holds the rotating presidency, said the system was intended to 'provide greater stability and certainty in the international tax system moving forward.' The breakthrough came after the United States dropped Section 899, a controversial clause in US President Donald Trump's tax bill, which had proposed retaliatory taxes on foreign companies operating in the US. According to news agency Reuters, its removal paved the way for broader agreement and eased concerns in countries like the UK, where businesses feared exposure to punitive tax provisions. British finance minister Rachel Reeves welcomed the development and was quoted by Reuters as saying, 'Today's agreement provides much-needed certainty and stability for those businesses after they had raised their concerns.' Tired of too many ads? go ad free now Reeves also reaffirmed the UK's continued efforts to combat aggressive tax avoidance globally. The move follows concerns raised earlier this year after Trump pulled the US out of the 2021 OECD-brokered global tax deal through an executive order. That landmark agreement, supported by nearly 140 countries under the Inclusive Framework, had aimed to ensure large multinational companies pay at least a 15% tax rate globally. According to news agency AFP, Trump also threatened retaliatory taxes on countries applying the global rules to US companies, a step that created apprehension among international investors. With the Section 899 provision now withdrawn, the new dual-track solution reflects a broader consensus among G7 nations to preserve tax sovereignty while maintaining progress on tackling base erosion and profit shifting (BEPS). The US Treasury said on X that this side-by-side approach would "preserve important gains made by jurisdictions inside the Inclusive Framework" and that it looks forward to developing this solution further through constructive discussions. The agreement now awaits further deliberation at the OECD level to determine how exemptions for US and UK firms will be formally recognised under the global tax regime. G7 leaders reiterated that the final solution must be "acceptable and implementable to all."
