French President Emmanuel Macron has staked France’s partial credit for the international corporation tax treaty supported by the heads of state and government of the seven richest countries at the G7 summit in Cornwall over the weekend.
“France has been fighting for four years to correct the deep injustice of the international economy,” Macron told journalists in the lysée palace. This injustice stems from “the fact that large corporations make super profits because digital activities allow them to optimize so that they do not pay their fair share of taxes”. This is “inexplicable for our taxpayers and compatriots and unjust for our companies … We have carried this agenda. We fought for it. “
Macron accused the Trump administration of blocking efforts by the OECD to establish an international corporate tax system for four years. He said France had carried the same fight into the European Union. Several member states like France have introduced national taxes on the profits of digital giants in their countries “to move forward. France did that. She feels comfortable with it. “
Former US President Donald Trump imposed sanctions on French wine and a number of other French products in retaliation. Macron called the French companies concerned “collateral victims of our sense of responsibility” and said it was important to remember and thank them “the moment we see a victory for this international tax”.
The Biden administration has suspended but not formally lifted sanctions imposed by Mr Trump. “There is no longer a trade conflict as we all agree,” said Macron. The new US administration “shares most of our convictions,” he added.
Macron expects France to gain between € 5 billion and € 10 billion annually from the new international corporate tax regime, while European economies will gain around € 50 billion. He said the agreement would enter into force “around 2025”. Other officials have cited a shorter timeframe.
Finance Minister Paschal Donohoe said meanwhile that the treasury could lose 2 billion euros annually.
The deal “completes the work that began at the time of the 2008/10 financial crisis” and previously ended banking secrecy, Macron said. “It is a massive step towards a fairer and more efficient globalization.”