tv [untitled] November 1, 2021 2:30pm-3:01pm AST
getting across the international border, i that was sort of head number one and now having to navigate the different restrictions and the different approaches to domestic orders remains challenging. that's a hurdle. these were united families, a willing to overlook for now. this year at clark al jazeera queensland, australia ah, hi, this is al jazeera, these are the top stories. world leaders are arriving at glasgow for the un climate conference. the g 20 meeting earlier a day earlier. rather leaders agreed to take greater action to limit global warming, although there were few firm commitments. amandito has more from taska 25 falls and delegates from almost 200 countries are in attendance. here the opening ceremony is
expected to pick off in about 4 hours with the british prime minister, yukos prime minister boris johnson. telling the govern delegates and would lead us that time is running out. we are a minute to midnight is expected to told them in terms of a clipping global warming below 1.5 degrees celsius. more than 5000000 people have now died from cove at 19. that number comes from john hopkins university. the world health organization estimates the actual figure could be almost 3 times higher. and once efficiently reported, nepal has been experiencing days of flooding and devastating land sides of the 100 people have been killed and homes and crops have been destroyed. expert say land signs are becoming more common in the himalayan region. as rains become more intense in places, milk. grease is registering nearly 400 migrants rescued from
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the world's biggest companies are told to pay their taxes g $20.00 leaders approve a global minimum rate of 15 percent. will this be enough to prevent tax dodging and who will benefit this is inside stored ah hello and welcome to the program. i'm how much of jerome tax avoidance has long been a controversial practice in global business. multinational firms make money in $1.00 country and move their profits to another, where they can pay little or no corporate tax. the world's largest economies are
trying to stop this. leaders of the g 20 have endorsed the plan to force the world's top $100.00 firms to pay taxes in the countries where they operate. and they've agreed on a minimum rate of 15 percent. the deal followed discussions between $140.00 countries earlier this month led by the organization for economic cooperation and development. we understand that countries around the world, including to use the now has to work on the implementation of this deal. so dear domestic processes, i'm your confidence at the u. s. and countries all around the world and have signed on to this to who will now seek to implement it swiftly and in good faith. but you know, that's no model for the, the domestic processes in all those jurisdictions that have signed on. ireland was one of the last countries to agree to the 15 percent corporate tax rate. it's low taxes, encouraged firms like google, apple,
and facebook to set up their european headquarters there. but kenya, nigeria pakistan an sri lanka, rejected the agreement. kenya said the plan makes it hard for its government to collect levies from multinational tech giants. while nigeria says 15 percent is too low. ah. all right, let's bring in our guess in dublin, richard boyd, barrett and irish politician and member of parliament for people the for profit in boucher mustafah and dodgy will executive director of the african center for tax and governance and and bill bow. susanna ruiz, rodriguez oxfam internationals, tax justice, lead a warm welcome to you all, and thanks so much for joining us on the program today. susanna, let me start with you today. oxfam has said that the o e. c. d tax deal is a mockery of fairness. why was deer level or some be shown with said this deal after almost a decayed negotiation was very high,
it was supposed to be ending the rest of the bottom, facts, competition between countries he was supposed to. and those are the profit shifting to tax haven, and he was supposed to be raising additional significant additional revenue for a lot of countries. this is not going to be happening is a deal for rich countries between beach countries and most of their additional revenues will be limited to those countries, especially g 7 and will be at once. so that's why we are disappointed because after such long negotiations, what we have been as seen under under as an outcome his 1st but was expected especially for developing countries. that must offer of course not all countries or we're happy about this deal. why does nigeria reject the agreement? so you never get to the deal for a few reasons why is largely on the vessel. so as you know, the threshold required that multinational company that on the school bus one have
to have a global minimum, a global revenue about 20 years. and even beyond the global revenue, 20000000000 years, the profitability has to be as low as 10 percent. there is a part that requirement to be local about 1w1w years. and you see that we did about 100 companies only fall under the special, which means most of these countries, most of these companies went in and that you will not be able to get revenue. that is one. secondly, in the issue of dropping all the unilateral measures, for example, i drive over already walking under significant comic bread and which brings in all non resident companies or region including both digitalized non non highly digitalized companies. so i deal with huge thresholds scope
means that i'd be giving away a lot of revenues and i think that the dog teen on the one that is a consent and that is that there is a monday to be binding dispute resolution. because so if there's any dispute and then you ask the has to be done at the international level, not a domestic level and this sort of what made you at a disadvantage. i think lastly, one of the main issues that i like that is that the reach the 15 percent global minimum factory that i've read because nigeria already has a corporate income tax, you know, by 30 percent, although it's monday, effective attacks rate. however, what we see is the 10 percent is already the threshold. the level also many developed countries, ireland, through the already around i read. so if, if this deal is supposed to be fair and it should be, should go across all countries. it's not looking like it's fair to you and other
countries and the big question is if nigeria can rely on time because of these regions, i'm wondering why other countries find it difficult to understand. the reason why other countries, particularly already will have been going to say, richard ireland, of course, has tax rates that are so favorable. they attracted the likes of apple and google. how was the country finally convinced to come aboard with this plan because they were a hold out for a long time? well i, i think it, yes, the irish governments. huh. now, i mean, we're a minority voice and saying this for a long time, but said they are filmed. and most of the arch political establishments really played a central role in leading the race to the bottom globally, in terms of reducing the amount of tax that is incredibly profitable. companies at paid and they are stubborn. he resisted any
a corporate tax reform and held out to the very last moment, even on the 15 i per cents. which would be an increase on the very, very low level of 12 and a half percent. that's currently charged an ard and, but i mean one of the points i make and it bears out the skepticism of your other guests. is that 12 and a half percent, which was already a pitifully low level of toxic to impose on these companies was never paid an ardent, at the actual raise was a fraction of that because of a whole range of lu poles, tax reliefs, allowances at the use of creative accounting by these companies through various subsidiaries. so i would be very, very skeptical that this deal is actually going to achieve any kind of increase in the actual effect of regs of tax paid at by these companies. and i would absolutely echo the anxieties that your other guests have articulated. and i think most of the
motivation at all, some of the bigger, older western economies was not so much to deal with the terrible inequity that results from these companies paying little or no tax, but was more of a particular countries being jealous of each other in terms of how much of the revenue they got. so then i saw your react and quite a bit to what richard was saying there looked like he wanted to jump in. i also wanted to ask you from your perspective, what would the global minimum tax rate need to be for this to be an acceptable deal? well, it says, look what rita was saying. i agree because everybody's looking there are the 15 percent which is already low, but in fact the, the, the real effect expects rate will be much lower than that. and we'll see what near island is going to negotiate. not now, or when the implementation of this sir global deal will come to the use of the and ever is going to be tough read here and especially on on that. so what we would expect is it will really want to 5 tar ah,
the race to know about that. we will really want to ensure additional revenues below 25 percent. it would be impossible as effective x ray does. what does some experts make there? e, craig, did the national commission under, for literally the international corporate taxation have been seen with people. i go to the steve, this was how we get he at we need a higher rate because that's the time for doing that. we've seen the case so far, effects competition between countries we've seen, decayed, suffer, artificial buffy shifting to that 7 with companies 1000000000 close to zito. this is a time to have an effective tax rate that reading is south on yeah, average the what as cities and sort of begun under other incom most most of i just want to talk about some of the other concerns that you and other countries may have i mean, it is one of those worries that you would have these countries making rules that would impact other countries say, developing countries or poorer countries in ways that are the countries we're
making, these rules are taking into consideration. definitely one is what i mentioned, the natural measures that i've been without, if you sat on to do feel like i mentioned that you are already working on any kind of a presence room and trying to get that implemented. so the already on the way to do that now come to the deal that says, you know, abandon all of these, but then we just give you a fraction of potential potential revenue. and another issue is that the, for the global minimum tax rate. so, so one of the condition is that if, if, for example, in a junior the, you talk to some multi nationals below the 15 percent effective tax rate. what happened is that portion that is not tax will last legal dis, headquarters. most likely going to be countries. so at the end of the day, the revenue is going to go to the revenue for some of these countries.
and i think the major problem is that these deals are done in a very, very fast and done in a rush, right? the countries don't have enough time to, to think through these items, for example, back is done initially agreed. but then later when you have time to look at these care about that, no, we're not, we're not going to sign onto this. so on the issue that i think needs to be looked at, richard, i'm looking forward. i want to talk about some of the potential hiccups that could come up here is the you going to be able to push this tax reform into law. and if so, when can you expect that to happen? what's the timeframe we're looking at? and i don't mean their time frame, they're talking about it for implementation is i answer 2023. i will they be
able to, i mean, i really not sure. i think it depends a lot on if you like the political pressure that we can exert. i mean, the one positive thing i will say is that it opens hill balance li, recently the irish government wouldn't have countenanced any change in the irish corporate tax regime and were bitterly opposed to even at the you know, the very, very modest changes that we're talking about under this young as we've discussed, completely inadequacy and process. so they are under pressure and i think the big global multi nationals are under pressure. but we got to keep that pressure role and to make sure that we get real reform and where there is and, and, you know, a genuine mood to make these corporations paid our fair share of a pair, fair parish at fair share of taxes. my studies are at what the, i mean i am deeply concerned because is the even how you calculate what is
a profit is a huge problem. i mean, one of the features of the assist the situation in ireland where corporations were supposedly paying 12 and a half percent, but actually were paying on average like about 5 percent. and in many cases, much, much less than that was that much of their tax was written off against various allowances and moved to other subsidiaries. so what we're actually profits through creative accounting were deemed to be costs. so they never came into the scope of taxation. and i would be deeply concerned unless we have a genuinely affected increase in the rate at these companies will find ways through loopholes around paying any additional attacks at all. so we really got to hone in on that detail, insist that there's a really affect increase in the, in the raise of tax. and that there's affairs allocation of the tax revenues to the countries that have been absolutely robbed. and particularly in africa,
the middle east developing world for whom this deal is woefully inadequate. this is anna. i saw you nodding along to lot of wood, richard was saying, did, did you want to jump in? did you want to add to that? and then the european union has a big shot as on the desk supposed to be present in a proposal very shortly before the end of the year on the plot. so, but now this issue that they could have been developed taken on tax has, in, by unanimity and again, ireland can play a role in that and making things easier. just deal buffington's grandma going to be the young, the country. so what we see that indiana must under this is on the level of ambition in there in all this globe ideally said by what is negotiated on or in both in a way. they countries like d, u. s. because ignace, to post of congress, met in the us and also by the level of ambition that countries like i am and what the sex interval. but i love because i will have an implication of the good of band . there is nothing like a global fueling, multi lateral process is nothing like that a deal that was supposed to be there to,
to provide the defensiveness for developing countries. he said that he said just a concession to summer by kevin sand to some big economy. isn't that what he's acceptable for to the business? big business in those economies, muster for our poorer countries eventually going to be pressured into joining the system? yes, i mean, like we've seen already. so i read the question earlier, why developing some developing countries? and the reason is sometimes this is beyond technical, they're largely political issues. so in most countries in africa, well you find the disconnect between the political and technical side of things. so the major finance may recommend that a deal is not good. but if you have trade deals, investment deal at the political level, they will just sign this thing done. and these are significant impact. and that's why i said it's, it's really, really confusing. why any, any developing countries,
any african country will say that. but what i can say is that it's, it's not binding other than any country that realizes that this deal is not good for them. the point is still, it's still not late for countries to, to pull out, just like pakistan did. they know they're not, they're not, they're not interested in the deal. it's not fair. richard, of course us president joe biden. he's really been driving this. he's been championing this agreement and pushing this. he considers this to be a win for his administration, but it seems as though not all us law makers are on board with it, at least not yet. if he encounters significant resistance in the u. s. congress. does that imperil this deal overall? yes, i would say on those italy, it does. and i mean obviously,
i think this one part of the political system in united states who see das, if you like, you know, the, the u. s. revenue is things that seriously to please it by the tax avoidance strategies, all of these companies. but there is others who are really mouth pieces for those multi nationals and don't want to see them pay their fair share of tax. so yes, i think it would in perilous. i mean, i don't believe as bad as the deal is i don't believe the irish government, whoever it really acted as champions of tax piracy and operated as a tax haven. i don't think they would have even gone along with it. did this minimal deal if it weren't for at the pressure from the biden administration? so i think it would seriously jeopardizes i would, as we discussed. i mean, even if the deal is agreed and it's so minimal, it's very questionable what difference it would make. and i think we really certainly what i would be arguing here is that at yes at, we should have
a minimum affective res i. but it has to be a genuinely minimum effective rate, and it should be a lot higher than it currently is. i mean, it's an absolute scandal that the cleaning woman a in google in dublin pays a higher proportion of her at meager income in tax than the company she works for. ringback that he's making billions and billions of europe in profits every year. i mean, it's an absolute scandal. at the very least, these corporations should be paying the same level of taxation that the ordinary worker has to pay on there and much less her income susanna. and everybody on the panel seems to be an agreement to day that the deal doesn't go far enough. um let me ask you this. is this going to make it any more difficult from your point of view, is, is going to make this any more difficult for multinational corporations when it
comes to evading taxes, i think is going to make a decent and suddenly when using the z dot ac servants so what we are doing is changing them using disease like servants, florida shifting out, usually shifting profits to now another nature that it's, they're not even 15 percent as we were saying, but below 15 percent. and that's a reality. we just made a concession to something that is well below. i mean it's better than what we have the status quo, but really far from the, the overhaul of the system that will work from you. and fact from the opportunity we could be reaching after the gate and the gate and they gave. so for decks competition and, and abuses of tech 7. and we've here, we've seen us another and they go for offer backs leaks, or we said that but that update, but it's a different reality and it is affecting everybody's life. so we have good companies operating from those that have and that will have an impact in their, in they do. they live in the, in the way those checks inside are distributed. how deposits are those like in ira
located? so this is just not acceptable at this sir. at this moment, that should be impossible than the deb kicked 20. unacceptable or did she? 20 is kind of historic. this low level of foundation must suffer. what do you think is this deal at its core? going to be enough to prevent at least some tax dodging in the future, or are there just going to be too many loopholes that can be exploited? so it's difficult to, to answer this question. because when you, when you, when you think about the fairness, it's fair or unfair, right? so i'm reluctant to, and in the way that it looks like there's some, some, some sort of a fairness by looking at it from, from an efficiency perspective. the fact that if a minimum tax rate global tax with works, that will be we will, we will get rid of 0 tax you restrictions. yes,
that seems like lag like a step forward. however, the implications regarding developing countries and how some of these revenues that are supposed to be, we'll still go back to the countries that remained an issue. richard, how much is this agreement kind of force, tax havens like ireland to rethink, to restructure their economies? what, what goes into this now? well, you see, that's a very good question and that, you know, i mean, at one level, the irish at stacy, our physical establishments have got a benefit from this. because remember, even though they're very low levels of tax, the sheer volume of profits booked in ireland have meant they have got attacks a boon from it to some extent. and of course, there are some real activities in terms the headquarters of some of these organizations here,
but i having real employment here. but the problem is that it is made the irish economy extremely vulnerable and because it is so dependent on a small number of firms. so the irish eco growth figures are absolutely out of sync with the actuality of the irish economy. and it makes those terribly vulnerable, and i certainly have been arguing for a long time, we need to diversify the irish industrial model away from this incredible dependence on being attacked. hayden, on a tiny number of multi nationals, both the irish and the major political parties in ireland are seen very much where it is at to that dependence and essentially to that low tax at models. so it's very much in play, but the one thing i sort of welcome from this process is that i do think there is a light being shown on the absolute scandal of how little these multi nationals are paying and how the fact that they don't pay their fair share of tax is robbing ordinary people across the world of vitally needed at revenues for health care,
for housing, for education. and so i welcome the fact that that is coming into view that the debate is opening up. but it's very uncertain how it's going to play. i'm not going to be a matter of politics, essentially, and winning the argument. and that it is fair. and it is possible to make these corporations pay a fair share of tax towards, you know, the people who generate those profits across the world and towards the infra structure. because, you know, i think an important point to make is the lack of investment in key infrastructure across the world. ultimately, it should be something these companies themselves see about you it, i mean we, we've had power outages recently in this country. we problems with the water infrastructure. those are repeated many other countries around the world, you know, in the ends. even those companies won't be able to make the profits if we don't have enough tax revenue to put in the vital infrastructures we need to sustain as
society on. all right, well we have run out of time, so we're gonna have to leave the conversation there. thank you so much to all our guests, richard boyd. barrett mustafah individual, and susanna ruiz, rodriguez and thank you for watching. you can see the program again any time by visiting our website al jazeera dot com and for further discussion, go to our facebook page. that's facebook dot com, forward slash ha inside story. you can also join the conversation on twitter. our handle is at ha, inside story for me. mm hm. mm hm. june the whole team here. bye for now. i ah.
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