Mission Recovery: How Big Tech’s Tax Bill could kickstart a fairer economy
Today ActionAid released a report which estimates that G20 countries are facing a potential gap of US$32bn in annual tax revenue from just five of the world’s largest tech companies. Just one year’s tax bill from these five companies could have paid for full two-dose Covid vaccination for every human on earth.
We argue that action is needed to tax the digital economy better. While we welcome a global minimum corporate tax rate as part of BEPS 2.0., we argue that it should be set at 25% or above, and that it is not sufficient to address the challenges of the digital economy as it does not address the distribution of taxing rights. As our hopes for pillar 1 are relatively low, we are suggesting countries may want to consider unilateral measures in the short to medium term to tax the digital economy in the absence of a satisfactory global deal, and provide an overview of some potential profit and transaction taxes that countries may want to consider.