What is the news : Finance Ministers from the Group of Seven (G7) nations have reached a landmark agreement in London setting a global minimum corporate tax rate.

Aim :

• To counter tax avoidance through measures to make companies pay in the countries where they do business.
• In principle to ratify a global minimum corporate tax rate to counter the possibility of countries undercutting each other to attract investments.

Countries involved:  US, the UK, Germany, France, Canada, Italy and Japan

Decisions taken :

• Force multinationals to pay taxes where they operate
• The agreement commits states to a global minimum corporate tax rate of 15% to avoid countries undercutting each other
• Reaching an equitable solution on the allocation of taxing rights, with market countries awarded taxing rights on at least 20% of profit exceeding a 10% margin for the largest and most profitable multinational enterprises.