Finance ministers from wealthy Group of Seven (G7) nations today moved towards supporting US-backed plans for a minimum global level of corporate tax aimed at getting multinationals - especially tech giants - to pay more into government coffers hit hard by the pandemic.
German finance minister Olaf Scholz said he was confident the G7 talks would end in an agreement on global taxation that would change the world.
"These are very successful talks, we are making progress and I'm absolutely confident that we will get agreements today and tomorrow," he told the BBC following the first day of G7 finance ministers' meeting in London.
"We will be able to have a very clear message on global corporate taxation," he told the BBC following the first day of G7 finance ministers' meeting in London.
"We will have an agreement which will really change the world."
According to a draft communique seen by AFP, the finance chiefs and central bankers of the world's seven richest nations will express "strong support" and a "high level of ambition" over a minimum global corporate tax rate.
They then hope to reach broader agreement at a G20 finance meeting scheduled for July.
US President Joe Biden has called for a unified minimum corporate tax rate of 15% in negotiations with the Organisation for Economic Co-operation and Development (OECD) and G20.
His proposal has so far won broad support from countries such as France and Germany, as well as the International Monetary Fund.
A deal on a minimum corporate tax rate is "within sight", finance ministers from France, Germany, Italy and non-G7 member Spain declared today.
Ireland's corporate tax rate is 12.5%. The Minister for Finance, Paschal Donohoe, said last April that he has "reservations" about a minimum global corporation tax rate.
Depending on how it's designed and implemented, a global minimum rate would undermine the tax advantage offered in jurisdictions with low rates like Ireland.
Minister Donohoe is attending the G7 talks in his capacity as President of the Eurogroup – the collective term for informal meetings of the finance ministers of the eurozone.
He said ministers are set to "consider coordinated approaches to the key economic challenges facing economies emerging from the Covid crisis", as well as "key global challenges, including climate and nature; health finance; and support for lower income countries".
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Speaking before the meeting, Mr Donohoe said: "There is now clear light at the end of the tunnel with the accelerating vaccination roll-out, falling infections and pressure on intensive care services gradually coming down.
"This year the euro area economy will rebound strongly. Our economic policies have been instrumental in facilitating this recovery and in shielding our citizens over the past year, maintaining jobs and putting our economies in a position to recover strongly."
UK Chancellor of the Exchequer Rishi Sunak said he is aiming to secure a "fair deal" on digital taxation as he welcomed overseas ministers to London.
Ministers from the US, Japan, France, Canada, Germany and Italy will attend the two-day meeting at Lancaster House in London, ahead of the leaders' summit in Cornwall next weekend.
They will discuss measures to tackle climate change as well as efforts to secure an international agreement on how digital companies are taxed.
Speaking ahead of the meeting, Mr Sunak said: "The G7 is a hugely important grouping and it's an honour to be welcoming my counterparts to London with a renewed spirit of multilateral cooperation.
"Even before holding the G7 Presidency we've been clear on our priorities - protecting jobs, ensuring a green and global recovery and supporting the world's most vulnerable countries.
"Securing a global agreement on digital taxation has also been a key priority this year - we want companies to pay the right amount of tax in the right place, and I hope we can reach a fair deal with our partners.
"I'm determined we work together and unite to tackle the world's most pressing economic challenges - and I'm hugely optimistic that we will deliver some concrete outcomes this weekend.
"Together we can make a real change and help steer the international community through the next stage of our recovery."
Director of Public Affairs at Chartered Accountants Ireland, Brian Keegan, has said that it is unlikely that the Government will agree to increase its corporate tax rate at this weekend's G7 Summit.
Mr Keegan told RTÉ's News at One that scrapping Ireland's 12.5% corporate tax rate has been a talking point for years, but has never happened.
"It's been something that people have been looking to go, if you want to put it like that, for at least a decade," he said.
He said at the end of the day, "being a low tax rate jurisdiction is not the same as being a low tax jurisdiction".
"Even though we've a low tax rate, Ireland takes more from its companies relative to the overall take than most other countries," he said.
Mr Keegan said taxation revenue is 5% - 10% of the total amount of tax collected for most of the other countries.
"In Ireland, it's closer to 20%, so the Minister's main priority will be to secure that stream of revenue that he already has," he added.
US President Joe Biden, is asking other leaders to follow his lead in reducing corporate tax rates internationally.
Mr Keegan said President Biden needs to collect more tax from his companies, which he said will make the US a bit less competitive in the global market.
"So what Biden is urging other countries to do is to adopt a minimum corporation tax rate to sort of compensate for a discrepancy in the hike of US corporation tax rates and the global landscape," he said.