October 30, 2021 3:00:30 am
India is pushing G20 nations to ensure that large multi-national corporations (MNCs) pay a minimum corporate tax in the countries in which they operate. A number of countries have raised the issue of large MNCs shifting profits and taxes to low tax jurisdictions, regardless of where revenues are generated.
India loses about $10.3 billion per year as a result of such moves by MNCs, including Big Tech majors Facebook, Google and Amazon that move profits to low-tax jurisdictions such as Ireland, the British Virgin Islands and Panama. “On tax reforms, India has pushed the G20 nations to address the mismatch between source of generation of profits and the jurisdiction where profits are taxed. This will ensure large MNCs pay a minimum effective corporate tax in the country of operation,” Commerce Minister Piyush Goyal said in a press briefing prior to the start of the two-day G20 summit on Saturday.
India had earlier this year amended taxation rules to impose an equalisation levy of 2 per cent on trade and services by non-resident e-commerce operators with a turnover of over Rs 2 crore. The US had in June announced a retaliatory tariff on Indian imports after concluding the taxes targeted US firms but immediately suspended the tariffs for a six month period noting that the US was “committed to reaching a consensus on international tax issues through the OECD and G20 processes.”
Goyal said India had received wide support in its call for mutual recognition of travel documents, including testing and vaccines certificates. India is seeking an easing of travel restrictions to allow Indian professionals to resume work and students in other countries. He added India has raised the issue of a waiver of intellectual property rights on Covid vaccines at G20.
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