Boris Johnson has been warned not to make Britain the odd-one-out in a global campaign by rich countries against big time tax avoidance.
The call for an international minimum rate of corporation tax - the one large companies are expected to pay - is being led by US President Joe Biden.
It would hit giants like Google, Amazon and Facebook who legitimately slash their tax bills by “profit-shifting” from one country to another.
Britain is the only G7 country not to back the plan, even though the PM will preside over the summit due to discuss it in Cornwall next month.
It would mean an increase in Britain’s rate from the current 18 per cent to the President’s target of 21 per cent - a massive £13.5bn extra tax bill for companies.
What is your view? Have your say in the comment section
France, Canada, Germany, Italy and Japan have all indicated support for the presidential initiative.
It would hit companies such as online giant Amazon and big tech multinationals and phone companies.
Labour says the cash could be used to fund health, the public sector and boost local communities.
Shadow Chancellor Rachel Reeves and Shadow Foreign Secretary Lisa Nandy have jointly written to their Government counterparts saying the Biden proposal is a “once in a generation opportunity to stop huge multinationals avoiding British tax”.
In their letter the pair say: “The UK is the only member of the G7 that is lukewarm to the idea.
"This is concerning given that we, as hosts, control the agenda for the summit”.
They say the aim is to put an end to “clever accounting” which companies are able to use to legitimately slash their tax bills by “profit shifting” from one country to another.
Ms Reeves said: “ Boris Johnson and his Chancellor have promised to get tough on tax avoidance, but they have failed everytime.
"This global pact would bring in billions of extra tax benefitting Britain.”
Mr Sunak has said companies such as Google, Amazon and Facebook need to “pay their fair share of tax” and that he would seek an international agreement when the G7 meets in Carbis Bay “on how to tax these companies”.
No details have emerged yet from Downing Street or the Treasury of any concrete plan.
Mr Sunak and the PM are resisting any increase in corporation tax, a Tory totem for encouraging business confidence. The Chancellor brought it down from 19 per cent, taking effect just in April.
Any move would require a new international treaty between the 37 members of the world trade group, the OECD.
Amazon insists it pays “all taxes required in the UK”, which amounted to £293m on sales of £13.7bn according to latest official figures.
