G-20 News

World leaders approve global corporate minimum tax as G-20 kicks off


ROME – President Joe Biden and other world leaders expressed support for a global minimum corporate tax at Saturday’s closed-door G20 summit, a monumental deal that U.S. officials say will lead to increased revenues to fund Biden’s Build Back Better program. .

After Saturday’s first plenary session, a senior Biden administration official said the leaders “have all come out in favor of a global minimum tax.”

While finance officials from most of the G-20 countries have already agreed to implement a 15% minimum corporate tax – ending a race to the bottom in corporate taxes that could prevent businesses to leave the United States for low-tax countries – the approval of heads of state is an important step towards the implementation of the agreement.

Final approval of the new tax was to be included in the joint communiqué, the statement that G-20 leaders issue at the end of the summit outlining their priorities and the actions they agreed to take. Each country will then have to go through its own process to ratify the tax.

An administration official said the global minimum corporate tax would result in at least $ 60 billion in additional revenue each year in the United States alone.

Covid, climate change and soaring energy prices were also to be high on the agenda for the opening session of the G-20.

“The president underlined his commitment to end the global pandemic and ensure an inclusive global economic recovery, including by supporting developing countries through debt relief,” the official said in a statement. “He reminded G20 leaders that new pandemics can strike at any time, so it is important that we strengthen global health systems and do more to build the global health security infrastructure to ensure that we are ready for the next pandemic. “

In his opening speech on Saturday in La Nuvola, where the summit is being held, Italian Prime Minister Mario Draghi stressed the need to come together to tackle some of the world’s most complex challenges.

“From the pandemic to climate change to fair and equitable taxation, going it alone is just not an option,” Draghi said. “We must do all we can to overcome our differences. And we must rekindle the spirit that led to the creation of this group.”

Biden and other G-20 leaders posed for a group photo before sitting down for the meeting. First responders joined in and several of them took selfies with Biden at the end.

Biden was seen briefly interacting with Turkish President Recep Tayyip Erdogan and British Prime Minister Boris Johnson.

Draghi warned the group in their opening remarks that the pandemic was far from over and more needed to be done to tackle global vaccine inequalities.

“In high-income countries, more than 70 percent of the population has received at least one dose. In the poorest, this percentage drops to around 3 percent, ”he said. “These differences are morally unacceptable and undermine the global recovery.”

The Group of 20, an annual gathering of international leaders representing the world’s largest economies, meets every year to discuss some of the world’s most difficult economic issues.

In addition to the United States, the G-20, which was founded in 1999 following a series of global economic crises, includes Argentina, Australia, Brazil, Great Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey and members of the European Union.

Together, member countries account for around 80% of global GDP and 60% of the world’s population, although some of the most populous countries, such as Pakistan and Nigeria, are not part of the G-20.

In the afternoon, Biden met on the sidelines of the G-20 with British Prime Minister Boris Johnson, French President Emmanuel Macron and German Chancellor Angela Merkel to discuss the relaunch of the 2015 nuclear deal with Iran. , known as the Joint Comprehensive Plan of Action, or JCPOA.

“We call on President Raisi to seize this opportunity and resume a good faith effort to conclude our negotiations as a matter of urgency,” the leaders said in a joint statement. “This is the only sure way to avoid a dangerous escalation, which is not in the interest of any country.”

Last week, Iran’s top nuclear negotiator said Tehran was ready to start negotiations before the end of November.

In the 2015 deal, widely regarded as the Obama administration’s greatest foreign policy achievement, Iran agreed to stop further development of nuclear weapons and allow international controls over its facilities in return. of an agreement by the United States to cancel the sanctions.

Since then-President Donald Trump withdrew from the pact in 2018 and reimposed crippling economic sanctions, Iran has started enriching uranium at 60% purity, close to military grade. , and denied inspectors access to certain nuclear sites. Iran has also been unable to access tens of billions of dollars of its assets due to US sanctions, which have strained its economy.

President and First Lady Jill Biden were also due to attend a gala dinner on Saturday night with other heads of state at the Quirinal Palace, one of the Italian president’s three official residences.