For decades, multinational corporations have used sophisticated strategies to shift profits away from where they do business. As a result, countries around the world lose an estimated US$500 billion annually in unpaid taxes, with developing nations hit particularly hard.
In the first of two episodes for The Conversation Weekly podcast called The 15% solution, we explore how companies have exploited loopholes in the global tax system. The episode features insights from Annette Alstadsæter, director of the Centre for Tax Research at the Norwegian University of Life Sciences, and Tarcisio Diniz Magalhaes, a professor of tax law at the University of Antwerp in Belgium.
The problem goes beyond clever accounting. Our international tax rules were built for an industrial age where companies were physically present where they operated. But today’s tech giants can generate billions in revenue from users around the world, without having a single employee or office there, leaving those nations unable to tax those profits at all.
In 2021, after years of international negotiations, the Organisation for Economic Co-operation and Development unveiled a global tax deal designed to address tax avoidance through a minimum corporate tax rate of 15%. But will this new framework actually work? And what happens when major economies refuse to participate?
Across two episodes, The 15% solution explores why a new global tax regime is needed, whether it can fix a broken system, and what’s at stake if it fails. Part two will be published on June 6.
This episode of The Conversation Weekly was written and produced by Mend Mariwany. Gemma Ware is the executive producer. Mixing and sound design by Eloise Stevens and theme music by Neeta Sarl.
Newsclips in this episode from NBC News, France24, BBC News, DW News and TRT World.
Listen to The Conversation Weekly via any of the apps listed above, download it directly via our RSS feed or find out how else to listen here. A transcript of this episode is available on Apple Podcasts.
Tarcísio Diniz Magalhães has received funding from the University of Antwerp Research Fund, Flanders Research Foundation, Social Sciences and Humanities Research Council in Canada and the Ford Foundation. He is a member of the Antwerp Tax Academy and DigiTax Centre of Excellence and is lead professor on International Taxation, Working Group on Tax Reform, ACMinas – Commercial and Business Association of Minas Gerais. Annette Alstadsæter is the Director of Skatteforsk – Centre for Tax Research which collaborates with the EU Tax Observatory on the Atlas of the Offshore World.
This article was originally published on The Conversation. Read the original article.
