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UK and Germany push corporate tax reform

Tuesday, November 06, 2012 - 02:01

Nov.06 - Britain and Germany are leading a push in the Group of 20 economic powers to make multinational companies pay their ''fair share'' of taxes following reports of large firms exploiting loopholes to avoid taxes. Matt Cowan reports

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A taxing issue has come to the fore at the G20 meeting in Mexico City. Following reports of large firms exploiting loopholes to avoid taxes, Germany and Britain are leading a push to make multinational companies pay what they say is their 'fair share' of tax. German Finance Minister Wolfgang Schaeuble. SOUNDBITE: Wolfgang Schaeuble, German Finance Minister, saying (English): "We spoke Thursday night and we were in agreement about the changes to the internet, e-commerce, and internet companies. We spoke about the volatility and the mobility that they have and the evasion of taxes." British Finance Minister George Osborne discussions at the G20 meeting showed there was "widespread support" for the joint initiative. SOUNDBITE: GEORGE OSBORNE, BRITISH CHANCELLOR OF THE EXCHEQUER, SAYING (English): "Our message to international businesses is that we want you to be successful, and we will do everything we can to make sure that our economies are competitive places for you, but you must pay the taxes that we expect you to pay." Last month, a special report by Reuters showed that Starbucks reported no profit and paid no income tax on sales of 1.2 billion pounds in the UK over the past three years. Technology companies - many of which base their international corporate headquarters in Ireland where the corprate tax rate is lower - have also come under scrutiny. The CEO of the Ireland's Industrial Development Agency Barry O'Leary spoke to Reuters TV at the recent Founders technology conference and said there's little chance Ireland would move to raise its 12.5 percent rate of corporate tax. SOUNDBITE:Barry O'Leary, IDA CEO saying (English) "We don't have a domestic market like others do. If you look at the size of the UK economy or the German economy, you have either 60 or 80 million people. We only have four and a half million people. So people are not going to come here purely to service the Irish market. So what we try to do is make sure our value prroposition is all encompassing. History would tell us, the higher the tax rate, the lower the tax take." In Mexico, Schaeuble and Osborne said international tax standards have not kept up with changes in global business practices. Germany and Britain say they will press their case during the Russian presidency of the G20 next year.

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UK and Germany push corporate tax reform

Tuesday, November 06, 2012 - 02:01

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