Janet Yellen calls for global minimum corporate tax rate

[Vor]

https://edition.cnn.com/2021/04/05/politics/janet-yellen-global-cooperate-tax/index.html
here is a link to the CNN article, would love to know what everyones thoughts are on this happening. I am hoping maybe pushes like this could be the final straw for low/no tax jurisdictions to band together and tell the US/OECD/EU to shove it finally? I however think thats just me dreaming and instead were gonna be all doomed with a global minimum tax of god knows what to stop the "race to the bottom" translation "stop people from being able to choose a country more friendly towards business and wealth".

 

[Silvio]

CNN is fake news

 

[Vor]

CNN is fake news

agreed CNN is absolute garbage, however if you wanna know what the communists in government are doing its a great source.

 

[Jerry1911]

She can suck my dick.......actually, nevermind

text text

 

[Martin Everson]

Pretty sure a global minimum tax will occur. EU is all about creating a level playing field aka stifling other economies so its high cost failing companies can compete globally. Then US is all about forcing its rules down other peoples throats i.e FATCA and destroying others economies so its own appears to be be in much better shape than it is. With sky high debt and falling GDP growth rates the major economies will welcome such a move.

So a global minimum tax will happen but question is what body will push it. My bets are on OECD being the driving force here. People are simply tired of US telling them what to do and Caribbean has had it with EU blackmail. Lets see how this plays out. The US is already signalling the direction it wants to go in i.e slow down global growth for its own benefit .

 

[petal355]

Why then not just getting taxed as a physical person ?

 

[JackAlabama]

Waiting for the world to bifurcate into the tax/state fetishists and the rest.

 

[Vor]

Pretty sure a global minimum tax will occur. EU is all about creating a level playing field aka stifling other economies so its high cost failing companies can compete globally. Then US is all about forcing its rules down other peoples throats i.e FATCA and destroying others economies so its own appears to be be in much better shape than it is. With sky high debt and falling GDP growth rates the major economies will welcome such a move.

So a global minimum tax will happen but question is what body will push it. My bets are on OECD being the driving force here. People are simply tired of US telling them what to do and Caribbean has had it with EU blackmail. Lets see how this plays out. The US is already signalling the direction it wants to go in i.e slow down global growth for its own benefit .

Yellen has said she wants to take it to the OECD so your assessment is gonna be 100% correct more than likely. In my dreams I wish the low/no tax jurisdictions would band together and tell the OECD, US, and EU to shove it. Even let CRS reporting fall apart in response and have a total return to the cowboy days... this of course will not happen and instead they will all bend over for the OECD.

 

[Vor]

Waiting for the world to bifurcate into the tax/state fetishists and the rest.

The United States in particular is due for a civil war, Biden has not reduced political tensions even if CNN and MSNBC are acting like things have returned to "normal" hopefully Biden's policies when it comes to oil drilling, gun policy, and tax policy could be the beginning of a red state secession but I'm probably just dreaming again and instead every spineless republican politician will comply.

 

[JackAlabama]

The United States in particular is due for a civil war, Biden has not reduced political tensions even if CNN and MSNBC are acting like things have returned to "normal" hopefully Biden's policies when it comes to oil drilling, gun policy, and tax policy could be the beginning of a red state secession but I'm probably just dreaming again and instead every spineless republican politician will comply.

Yup agreed, that what I was writing here some months ago, civil war in the US as possiblitly.
hope they split and we can all move to Florida and have a free live.

 

[Vor]

Yup agreed, that what I was writing here some months ago, civil war in the US as possiblitly.
hope they split and we can all move to Florida and have a free live.

that be the dream i however already left the US since I dont have much faith it'll not turn into anymore a liberal hellscape.

 

[Golden Fleece]

Why then not just getting taxed as a physical person ?

Well, for an American, if you live in a state with an income tax in the U.S. you pay upwards of 40% in income tax. Running an offshore business and living offshore can bring your tax burden down to 13%. Yellen proposes raising it to 20%. So, for an American, paying tax as an individual does not help.

Before the Trump tax bill, you could pay zero tax on all profit that you reinvested in your offshore LLC business. So, in less than four years, offshore Americans running an offshore business went from paying zero tax to 10.5% to 13% to possibly 20% .

 

[Vor]

Well, for an American, if you live in a state with an income tax in the U.S. you pay upwards of 40% in income tax. Running an offshore business and living offshore can bring your tax burden down to 13%. Yellen proposes raising it to 20%. So, for an American, paying tax as an individual does not help.

Before the Trump tax bill, you could pay zero tax on all profit that you reinvested in your offshore LLC business. So, in less than four years, offshore Americans running an offshore business went from paying zero tax to 10.5% to 13% to possibly 20% .

best bet is to renounce American citizenship that is what im working towards got about a year and a half to go to the exit door.

 

[zzzzzz]

best bet is to renounce American citizenship that is what im working towards got about a year and a half to go to the exit door.

Are you planning to go citizenship by investment route?

 

[Vor]

Are you planning to go citizenship by investment route?

i have the ability to get citizenship thanks to marriage and I own a business in the same country so luckily i do not need to spend money on a citizenship also its an EU passport but ill be living in a Caribbean territory of the EU country. I just need another year and a half to be eligible for the passport.

 

[manukahoney]

Surprised this topic is not discussed more vigorously, in fact the whole "minimum global corporate tax" might kill the whole offshore industry, at least on the corporate level.

Biden proposes global reforms to end ‘profit shifting’ to tax havens - some development.

 

[glengoolie]

i am not sure who talked about this, whether maneco64 or peter schiff or someone else but in summary, she needs money and you cannot increase the taxes above certain level, otherwise people will use black market and tax avoidance. i think the effective tax is always around 20%, no matter what governments do, they cannot take away more from people. i do not know how it's called but it is what it is. and governments know it. and so what she is trying to do is force other countries to make their taxes higher so instead of increasing taxes in usa, she wants to bring other countries on par with usa and level the playfield, on paper, so she would make other countries more expensive for people which would keep people from leaving usa and force them to pay taxes there since they would have no other options and essentially, other countries would become even more expensive to them. it's all about purchasing power and manipulation of it.

the thing is that there will never be minimum global tax. countries are are competing for rich people's money. this is what capitalism and "free market" is all about. they will always provide incentives to attract capital. some countries would collapse if they would implement even basic taxes because their economies would simply not be able to withstand it. and i am not even talking about caribbean tax heavens. look at portugal's madeira or spain's canary islands with their low tax trade zones. these places would not be able to survive with full tax system.
so all of this is just a pipe dream. plus, russia and china really do not like usa so there will, luckily, never by consensus on global scale.

 

[seabreeze]

Tell that to the City boys and US megacorps stashing trillions abroad.
Those guys yanked the UK out of the EU.
I'm sure they can make a cup of tea and sit out a woke US administration.

 

[manukahoney]

Tell that to the City boys and US megacorps stashing trillions abroad.
Those guys yanked the UK out of the EU.
I'm sure they can make a cup of tea and sit out a woke US administration.

They don't only want to introduce a minimum corporate tax, they also are actively pushing "regional taxation" - basically if you sell to US customers, you pay US corp tax on that, regardless of your jurisdiction. Something like this is already working in EU when selling goods, but no services - and there is where a lot of IT/service companies have found shelter (Cyprus based companies, HK/SG, Delaware corps selling to EU customers etc).

It's a bold and, well, reasonable move. And it will take a while to extend these rules to not only the global corps, but to all small companies as well. Corp tax is not the only tax of course, so offshore/low tax jurisdictions still can compete in terms of DWT, but it will make less and less sense to incorporate there with all the substance requirements, bank accounts hustle and CRS.
Interesting times.

 

[Golden Fleece]

Honestly, I was surprised to see so many countries cave after FATCA, but in hindsight I can see how the loss of access to the SWIFT system was a very big stick. Other nations refused to band together against the extraterritorial jurisdictional overreach of the U.S. and , indeed, Western European nations used it as an excuse to enact their own schemes (e.g., CRS). All these Western nations then used blacklists to slowly cow all the other nations.

In this case, I do not see the stick. Are countries whose main revenue is offshore business creation really going to give up all that irreplaceable revenue just because the OECD countries place them on some list?