France pushes for 25% target to tax multinational super-profits

VENICE, July 10 (Reuters) – Countries should be able to tax a quarter of the profits of large multinationals, no matter where they are made, France proposed on Saturday at a meeting of G20 finance ministers devoted to overhaul the rules cross-border corporate taxation.

Key details remain to be worked out after G20 finance chiefs formally endorsed plans that would establish new rules for the taxation of multinationals and set a global minimum corporate tax rate of 15%.

The emergence of digital commerce has made it possible for large tech companies to make profits in low-tax countries, regardless of where they make money.

The rules, which will be finalized at a summit in Rome in October, would allow countries where income is generated to tax 20-30% of a large multinational’s excess profits – defined as profits above 10% of income. .

Developing countries like Brazil pushed for a higher share, EU economy commissioner Paolo Gentiloni said at the meeting.

“I think the best solution would be a profit allocation level of 25% to address the concerns of certain developing countries which are legitimate concerns,” French Finance Minister Bruno Le Maire told reporters.

Companies considered within the scope of the new rules would be multinationals with global turnover exceeding 20 billion euros ($ 23.8 billion), although the turnover threshold may be lowered to 10 billion euros after seven years after an overhaul.

Gentiloni said some countries were pushing for the 10 billion threshold while others wanted to exclude certain industrial sectors from the scope of the new rules, in addition to financial services and mining industries which are already exempt.

($ 1 = € 0.8422)

Reporting by Leigh Thomas, additional reporting by Francesco Guarascio; Editing by Christina Fincher

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