France, Germany support US 21% tax plan for corporations

France and Germany support the U.S. proposal of a 21% minimum tax on multinational companies, French Finance Minister Bruno Le Maire and his German counterpart Olaf Scholz told Le Figaro and Die Zeit in a joint interview released on Tuesday.

“If the Biden administration proposes a 21% rate and there is consensus, it would be acceptable for us,” Le Maire is quoted as saying.

“It is important that we agree on a percentage — where exactly that will lie, the talks in the next few weeks will determine,” Scholz said. “Personally I would have nothing against the U.S. proposal.”

U.S. President Joe Biden’s administration has proposed combating corporate tax-reduction strategies with a global minimum rate of 21%, and a system for ensuring that the world’s 100 or so biggest companies pay more in places they actually do business.

While the broad proposal has received widespread support, after years of talks hosted the Organisation for Economic Cooperation and Development tried to reach a global deal, the precise tax rate could still be a sticking point.

France is also concerned whether the proposal on where the biggest companies pay their taxes would actually cover all the digital giants.

“As soon as this summer, we can reach an historical deal,” Le Maire said in the interview, adding that as long as a deal isn’t reached, France will keep its current tax over digital companies. “The change in stance from the Americans is excellent news.”

“We have good hope to reach a deal this summer,” Scholz said. “This will change the world because the tax competition is bad for everyone.”