London Daily

Focus on the big picture.
Thursday, Jul 02, 2026

G7 nations close to historic deal to tax tech giants in plan that would 'change the world', says German finance minister

G7 nations close to historic deal to tax tech giants in plan that would 'change the world', says German finance minister

The plan to reform the taxation of tech firms and bring in a minimum level for business tax rates would "change the world".

The world's leading economies are on the brink of announcing a historic deal to tax the tech giants, the German finance minister has told Sky News.

Olaf Scholz said the plan to reform the taxation of tech companies and introduce a minimum level for business tax rates would "change the world", bringing in billions of pounds in tax revenue which would otherwise have been shifted to low tax countries.

The comments came as ministers from the Group of Seven (G7) industrialised economies met in London for the first such face-to-face summit since the onset of COVID-19 over a year ago.

In part because of pressure from the Biden White House and US Treasury secretary Janet Yellen, the G7 ministers are understood to be on the brink of announcing an unprecedented set of reforms.

The plan would help combat profit shifting, where companies - including tech giants and multinational brands - can shift profits to low tax jurisdictions.

The deal entails two "pillars": First, there will be special rules to change how much tax some large companies will pay, and where those taxes are paid.

Hitherto business taxes were based purely on company profits; in future a chunk of those taxes will be calculated based on sales.

The second pillar involves the creation of a global minimum corporate tax rate, designed to encourage countries not to cut their business tax rate below 15%.

Speaking on the fringes of the London meeting between the US, UK, Japanese, German, French, Italian and Canadian finance ministers, Mr Scholz said: "That we've made progress on both pillars is what we have worked on so hard.

"It looks as if we will now make it, and it will change the world.

"We've worked very hard in the last few years to make progress step by step, we discussed with many people and many experts on this question and with many other countries, but now we are at a stage where an agreement is feasible.

"This is a historic moment, and it will help us to do our job: to serve our people. It's about fairness and justice."

Chancellor Rishi Sunak at a meeting of finance ministers from across the G7 nations


Asked about the implications of a deal for the tax revenues of developed countries, which some experts calculate could be boosted by many billions as profits are shifted back from tax havens, Mr Scholz said: "This will help finance our countries.

"We will profit very much from an agreement like this. But it's also a starting point for more fairness - that's what this is what it is about."

According to others close to the negotiations, the technical talks are still ongoing, with "sherpas" from G7 nations expected to carry on discussing details through the night.

However, Mr Scholz's comments represent the clearest sign yet that the G7 is likely to seal a deal on tax avoidance on Saturday.

That deal would be highly significant since it would encourage finance ministers from other, smaller countries to sign up to the deal.

But, there are some nations - most notably Ireland - which are holding out.

With its 12.5% corporate tax rate, Ireland would be directly affected by the global minimum rate, and would have to decide whether to increase its level or to face penalties from those economies committing to the new pact.

Newsletter

Related Articles

0:00
0:00
Close
UK DEFENCE AND TECHNOLOGY STRATEGY TILTS TOWARD SOVEREIGN CAPABILITY AND INDUSTRIAL INVESTMENT
UK ECONOMIC POLICY OUTLOOK SHAPED BY LEADERSHIP TRANSITION AND FISCAL SIGNALS
STERLING STRENGTHENS AMID SHIFTING MONETARY OUTLOOK AND GLOBAL LABOUR MARKET SIGNALS
UK HPV VACCINATION PROGRAM NEARLY ELIMINATES CERVICAL CANCER DEATH RISK IN YOUNG WOMEN
UK EXPANDS PRISON SAFETY REVIEW AS GOVERNMENT SEEKS WIDER SYSTEM REFORM
UK DRIVES DIGITAL ASSETS STRATEGY WITH NEW STABLECOIN REGULATORY MODEL
UK TO EXPAND AI INFRASTRUCTURE THROUGH NEW EUROPEAN TECHNOLOGY PARTNERSHIP
UK LAUNCHES £15 BILLION DEFENCE TECH SHIFT TOWARD ADVANCED MILITARY SYSTEMS
CIVIL SERVICE FACES SHIFT IN POWER STRUCTURE AS REGIONAL GOVERNANCE PLANS EXPAND
WHITEHALL CONSIDERS MAJOR DECENTRALISATION PLAN WITH SECOND GOVERNMENT HUB IN MANCHESTER
UK TARGETS SERVICES EXPORT GROWTH IN TRADE TALKS WITH CHINA AMID GEOPOLITICAL TENSIONS
POLICE WATCHDOG PROBES OFFICERS OVER HANDCUFFING OF DYING TEENAGER IN HAMPSHIRE CASE
UK REGULATORS UNVEIL DUAL OVERSIGHT FRAMEWORK FOR STABLECOINS AND DIGITAL ASSETS
KEIR STARMER ANNOUNCES £15 BILLION DEFENCE TECHNOLOGY BOOST IN FINAL MAJOR POLICY MOVE
ANDY BURNHAM SIGNALS STRICT FISCAL RULES AS LABOUR LEADERSHIP RACE SHAPES MARKET OUTLOOK
POUND STERLING HITS ONE-YEAR HIGH AS BANK OF ENGLAND SIGNALS NO IMMINENT RATE CUTS
UK Government Confirms Rejected Asylum Seekers to Remain Amid Enforcement Challenges
UK-China Economic Talks Focus on Services Trade and High-Value Sectors
Buckingham Palace Revamp Plans Unveiled to Modernise Royal and Public Facilities
Two Dead After Light Aircraft Crash in Essex Field, Investigation Underway
Princess Diana Marked at 65 With UK Tributes Reflecting on Her Public Legacy
England Teachers Face New Pay Cap Rules for Academy School Leaders Under Education Reform
Dublin Security Alert Escalates After Stabbing and Reports of Transport Disruption
UK Government Faces Scrutiny Over £10,000 Asylum Living Cost Contribution Requirement
England Prepares World Cup Knockout Match Against Democratic Republic of Congo
Northern Rail Project Warned of HS2-Style Cost Risks by UK Parliamentary Committee
UK Tightens Asylum Rules as Most Rejected Applicants Expected to Remain in Country
UK Heat Health Alert Issued as Temperatures Expected to Exceed 30°C Across England
Halifax Brand to Disappear From UK High Streets in Lloyds Banking Group Restructuring
England Teachers Receive 6.6 Percent Pay Rise Over Two Years as Schools Warn of Budget Strain
UK Defence Spending Plan Sparks Budget Clash as Regional Infrastructure Projects Face Pressure
Inquest Continues in Northern Ireland into Death of Noah Donohoe in Belfast
UK Travel Industry Calls for Suspension of New EU Border System During Peak Holiday Season
Telegraph Media Group Acquired by German Media Firm in £575 Million Deal Completion
House of Commons Warns Northern Rail Upgrade Risks Repeating High-Speed 2 Cost Overruns
UK Transport Unions Warn of Summer Strike Action Over Pay Disputes
UK Health Secretary Calls Maternity Care Review a “Watershed Moment” for NHS Reform
Nigel Farage Faces Questions Over £270,000 Payment Linked to Gold Marketing Firm
Labour Government Faces Internal Division Over North Sea Oil and Gas Policy Direction
National Screening Committee Invites New Proposals for UK Health Screening Programmes
UK and China Hold Industrial Strategy Talks on Trade and Export Growth Opportunities
UK Defence Funding Gap Widens as £4.7 Billion Shortfall Puts Pressure on Spending Priorities
United Kingdom Faces Historic Demographic Shift as Deaths Forecast to Exceed Births in England and Wales
United Kingdom Introduces Major Motability Scheme Reforms Targeting £1 Billion in Long-Term Savings
Global Billionaire Numbers Rise 13 Percent Amid Artificial Intelligence Stock Boom
Body of Fifteen-Year-Old Boy Recovered from Manchester Reservoir
Major Rail Disruption in UK After Cows Stray Onto Intercity Tracks
UK Launches National Campaign to Reduce Water Consumption After Heatwave
Foreign Secretary David Lammy Raises Case of UK Woman Death with US Authorities
Shetland Islands Council Approves Subsea Tunnel Plans Linking Major Islands
×