The introduction of a global minimum corporate tax rate, which the OECD accepted on Friday, could bring competitive disadvantage for the European Union, a government official said. Hungary was among nine countries that did not join a statement backing the introduction of a global minimum corporate tax rate at a meeting of members of the Organisation for Economic Co-operation and Development鈥檚 Inclusive Framework on July 1.
At the meeting, 130 members of the framework joined the 鈥淪tatement on a Two鈥揚illar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy鈥�, the finance ministry鈥檚 tax affairs state secretary told MTI. The first pillar, which Hungary 鈥渇ully supported鈥�, would re-allocate some taxing rights over multinationals from their home countries to the markets where they have business activities and earn profits, regardless of whether firms have a physical presence there, Norbert Izer said.
The second pillar would introduce a 15% minimum corporate profit tax. Izer said Hungary was on board with the second pillar of the agreement 鈥渁s long as it exclusively addresses artificial tax avoidance structures鈥�. 鈥淚n the case of profits generated from real economic activities 鈥� taxation is the sovereign right of every country, and no international organisation may intervene,鈥� he said.
Izer said the nine dissenting countries were 鈥渞eally just the tip of the iceberg鈥�. 鈥淩ather than speaking about the uniform support of 130 countries, it would be more accurate to say that there were that many that supported the proposal or that were not clearly against it,鈥� he added.
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