|The 21% global minimum rate called for by US Treasury Secretary Janet Yellen "strikes me as...high", head of the World Bank, David Malpass added.(Photo by= BBC)|
[Asia News Communication = Reporter Reakkana] The head of the World Bank warned world leaders against setting a global minimum tax rate for companies that is too high. In an interview with the BBC, David Malpass said he didn't want to see new rules that would hinder poor countries' ability to attract investment.
The 21% global minimum rate called for by US Treasury Secretary Janet Yellen "strikes me as...high", he added. Officials said on Wednesday they hope to reach a global tax deal by mid-year. Ms. Yellen has said a global minimum tax on companies is necessary to stop a "30-year race to the bottom", which has seen countries slash rates on companies, in an effort to woo business investments. She is in favor of having all countries agree to a minimum tax rate of 21%. Meanwhile, the US under President Joe Biden is seeking to increase its minimum tax rate to 28%.
To US lawmakers, Ms Yellen made the case that establishing a global minimum tax allows the US to remain competitive, despite that increase. The UK is also looking to raise taxes on corporations from 19%, up to 25% in 2023, in what would be the first increase since the 1970s. The average corporate tax rate globally is about 24%, according to the Tax Foundation. Europe has the lowest regional rate at roughly 20%.