At an OECD meeting in Paris on Wednesday, the Hungarian government submitted a proposal aimed at finding a compromise solution to the introduction of a global minimum corporate tax which Hungary has reservations over, according to the Hungarian foreign affairs and trade minister.
The proposals would align the measure with Hungarian interests and enable Hungary to retain its competitive edge, the foreign ministry’s statement cited Péter Szijjártó as telling a meeting of the Organization for Economic Cooperation and Development. Hungary proposed a ten year transition period for implementing the tax for “large corporations active in the real economy”, Szijjártó said. Exemptions should be given under certain circumstances, and the value of the companies’ assets taken into consideration when levying the tax, Szijjártó said.
Hungary currently has a 9 percent corporate tax, the lowest in the European Union, Szijjártó noted.
Its government will only accept proposals that would not jeopardise the low-tax advantage when it came to maximising investments and job creation, he said. The country’s low corporate tax was instrumental in “turning Hungary into one of the fastest-developing countries in Europe,” he said.
Regarding the OECD proposal on taxing big tech companies not tied to geographical locations, Szijjártó said the countries were “in full agreement on that part of the proposal”.
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Source: MTI
5 Comments
Government should not agree on a minimum tax. The EU and US are not doing Hungary any favores.
Having a global minimum tax rate will only help the rich countries at the expense of the poorer countries.
Once you set this then they will ask for minimium income tax, capital gains tax and VAT rates.
Its a plan to protect American jobs without cutting govt expenditure in America
“Regarding the OECD proposal on taxing big tech companies not tied to geographical locations, Szijjártó said the countries were “in full agreement on that part of the proposal”.
I like this. Big tech companies support socialism, communism. Take their money and make them eat their words. They promote socialism, communism, anarchy, mob violence; defund the police for the masses while secure in their heavily guarded luxury compounds,
They are the enemies of people.
The proposals only really benefit the US. Companies will still be able transfer profits out of host countries by counting the practice of the parent company (usually headquartered the US in big tech) charging the overseas units big fees and royalties for intellectual property rights. Previously this money flowed to offshore tax haven but this was partly choked off and under Trump tax reforms GILTI (Global Intangible Taxed Income) these fees and royalties were attracted back to the US through preferential tax rates. Fast forward to these proposals, the Pillar 2 element (global minimum rate taxation) send the money back to the country where the company is headquartered (regardless of where the money is made) which is usually the US. The Pillar 1 part of the idea affects about 100 companies, the b ig earners, and a small proportion of their profits will be taxed a divvied up but the price is for no country too have a digital services tax. This all is geared to the US reaping the rewards and other countries may get a few crumbs from the table.
Gyuszi is broadly correct and as usual, this István person is writing complete nonsense.