Global Minimum Corporate Tax to Avoid Tax Avoidance

With the implementation of liberalization policies after 1980, the globalization process has also accelerated. The liberalization of capital movements and the increase in the sensitivity of capital to tax rates have become an element of tax competition and have led to the emergence of tax haven countries. Tax avoidance tendencies have become easier through tax haven countries and nation-states have begun to lose income. Especially the negative effects of the 2008 financial crisis on the economy, increasing foreign debts and budget deficits have led governments to austerity policies. Companies have turned to tax avoidance activities to minimize their tax liabilities. In order to avoid corporate tax avoidance, G7 countries, under the leadership of the United States of America, proposed a global minimum corporate tax rate for the taxation of the earnings of multinational companies in the country where the income is obtained. 137 countries, consisting of countries with more than 90% of the global gross product, participated in the study on the taxation of the earnings of multinational enterprises in the countries where they are obtained. The study is planned to be put into practice by 2023. With the global minimum corporate tax to be applied at a rate of fifteen percent, it is anticipated that an additional corporate tax income of 150 billion USD will be generated globally. In addition to the stability of the international tax system, it is aimed to contribute to the increase of tax certainty in terms of taxpayers and tax administrations.