Japan Criticizes Us Digital Tax Proposal

Japan Criticizes US Digital Tax Proposal

Taro Aso, Japan’s finance minister, criticized a US tax reform proposal on Sunday that, according to him, could undermine global efforts to agree on new rules to tax large technology companies.
The Organization for Economic Cooperation and Development (OECD) is developing rules to make digital companies pay taxes wherever they do business, instead of registering their subsidiaries, a measure that was widely supported by the financial leaders of the major economies of the Group of 20 (G20) on Sunday.
However, OECD efforts stalled at the end of 2019 due to last-minute changes required by Washington, including a “safe harbor” policy that, according to critics, would allow multinationals to choose to comply with the new set of rules or adhere to existing regulations.
“I told my counterparts that Japan is very concerned about the safe harbor proposal,” Aso told reporters at a press conference after attending the G20 meeting.
He added that “the effect on regulations we are trying to make would be extremely diminished. That is an opinion expressed by several countries,” he said, joining a chorus of criticism from France and other nations about the US proposal.
Many G20 officials believe that the United States is reluctant to deal with a potentially complicated political issue before this year’s presidential elections.
The taxes of global digital companies such as Amazon, Google and Apple, and the effect of the coronavirus outbreak on the global economy, featured prominently at the G20 financial leaders meeting in Riyadh over the weekend.




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