The pandemic has deepened inequalities and asymmetries among advanced countries and the rest, and today, taxing multinational corporations is a must
The Minister of Economy, Martín Guzmán, participated this Monday in the panel “How to get a global tax deal that is fair to the world?”, organized by the Intergovernmental Group of Twenty-Four (G24) and the Independent Commission for the Reform of the International Corporate Taxation (ICRICT).
Within this framework, the head of the Ministry of Economy explained that due to the economic and social crisis generated by the COVID-19 pandemic, “inequalities and asymmetries among advanced countries and the rest, and the need to resolve the problem of tax avoidance by multinationals is even greater”. In this sense, Guzmán said that “we need to establish rules for the challenges we face today” and anticipated that Argentina will express at the G20 meeting in Italy that “the 15% rate is too low.” “The minimum rate will in fact be the maximum rate that is possible,” Mr. Minister added.
Likewise, Guzmán insisted that “from Argentina, we consider that a rate of 21% would be better, one of 25%, even better,” he said. Guzmán also said that in the next G20 meeting “there is a small window of opportunity to achieve something historic” and highlighted that “this is the moment”. “We have this year a G20 that certainly is addressing issues that matter. It is something positive and we think that the fact that it is being discussed is a step in the right direction,” he added.
During the meeting, Guzmán warned that “we are facing a great risk of increasing inequalities” and highlighted the need to establish “a formula that is based on a number of variables.” Along these lines, Mr. Minister highlighted that “there is a substantial risk that developing countries get very low revenues, so we need to fight against lobbies.” In addition, when asked about the challenges these countries have faced so that their needs and interests are reflected in these agreements, the Minister explained that “this is simply a matter of power relations, that is why it is so important that developing countries get together”.
In addition, the Minister of Economy stated that “we need reforms to address the transformations to achieve the objectives of economic and social development and structural transformations that allow countries to address these objectives.” “How can we finance that transformation? With more tax revenue”, Guzmán added. In this way, Mr. Minister said that “we need to solve problems in international taxation” and clarified that “if a multilateral compromise is achieved, it will be imperative for Argentina to find a reasonable way to consider the application of unilateral tax measures.”
Finally, Mr. Minister pointed out that Argentina aims at “an adaptation in the credit lines of the multilateral organizations so as to tackle the current challenges that require long-term solutions.” “We are confident that there is enough knowledge to have a proper debate and we hope to collectively construct the political views to move in the right direction,” he concluded.
ICRICT Chair, José Antonio Ocampo; ICRICT commissioner, Jayati Ghosh; Executive Director of Oxfam Mexico, Alexandra Haas; and Nigerian Minister of Finance, Zainab Ahmed, also participated in the panel.