{"id":8187,"date":"2021-07-19T07:00:13","date_gmt":"2021-07-19T07:00:13","guid":{"rendered":"https:\/\/focus.cbbc.org\/?p=8187"},"modified":"2025-04-23T09:52:16","modified_gmt":"2025-04-23T09:52:16","slug":"why-china-supports-the-new-global-minimum-corporate-tax","status":"publish","type":"post","link":"https:\/\/focus.cbbc.org\/why-china-supports-the-new-global-minimum-corporate-tax\/","title":{"rendered":"Why China supports the new Global Minimum Corporate Tax"},"content":{"rendered":"

China supports the G7\u2019s initiative for a Global Minimum Corporate Tax, which it prefers to the EU\u2019s digital service tax proposal \u2013 here’s why, writes Torsten Weller.<\/h2>\n

Relations with China figured prominently at June\u2019s G7 summit in Cornwall. Yet despite many media reports highlighting the differences and potential flash points between Western democracies and the Communist Party in Beijing, the meeting addressed several points where both sides are pretty much aligned.<\/p>\n

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While climate change is probably the most prominent talking point when it comes to cooperation with China, the planned global minimum corporate tax could well be another global governance project where both sides\u2019 interests largely converge. Thus, at the G20 \u2013 which took place on Saturday, 10 July, in Venice, Italy \u2013 China was one of the major economies which supported the G7\u2019s tax initiative. The final details \u2013 such as the exact tax rate \u2013 are expected to be fixed before the next meeting in October.<\/p>\n

In recent years, China itself has undertaken several steps to make tax avoidance more difficult and even passed several regulations which expand the reach of China\u2019s tax authorities abroad. The OECD\u2019s Inclusive Framework on Tax Base Erosion and Profit Sharing (BEPS) has provided China with the impetus to reform its own fledging tax system. A new global minimum tax for corporate income might well do the same. Yet domestic reforms to create a truly national tax register are still far from complete and many domestic challenges remain.<\/p>\n