London Daily

Focus on the big picture.
Monday, Jun 30, 2025

Sunak ‘confident’ of reaching tech tax agreement

Sunak ‘confident’ of reaching tech tax agreement

Chancellor Rishi Sunak says he is "confident" of reaching a global agreement on digital taxation ahead of a meeting of world finance leaders.

Tax on big tech companies has been a source of friction between the US and countries including the UK.

The US announced sanctions on Wednesday but then suspended them to give more time for talks.

Finance minsters will also discuss climate change at the two day meeting which starts in London on Friday.

On Wednesday the US announced it would impose tariffs on about $2bn (£1.4bn) of imports, including certain goods from the UK, in retaliation for taxes on big US tech firms.

However, it immediately suspended them to allow further talks to take place in the G20 and the Organisation for Economic Co-operation and Development (OECD).

Mr Sunak is expected to push for an agreement on this and call for all global businesses to commit to climate reporting.

The 25% tariffs the US wants to impose would apply to $887m of goods from the UK, as well as products from Austria, India, Italy, Spain, and Turkey.

The US has said that digital services taxes being imposed by the six countries, which tax tech firms on their revenues, rather than profits, are "unfair".

The US tariffs have been suspended for 180 days to allow talks to take place.


Rarely has an interviewee given me such an emphatic answer as when I recently asked the (now former) Secretary General of the Organization for Economic Cooperation and Development whether the new administration of President Biden had transformed the dynamics of the tax talks.

Angel Gurría, who stood down few days ago, told me: "Absolutely. The answer is completely, totally, yes".

Under President Trump the US was decidedly unenthusiastic about both "pillars" of the talks, the minimum tax rate and digital services issue.

On the latter, the Trump administration proposed something called a safe harbour provision, which Mr Gurría described as "some kind of optional take on the taxation".

Now the US is on board for both, though the proposed 15% minimum is too low for many campaigners' liking.

The G7 is not the forum when the final deal will be done. But the group's support, if they can make further progress, will give the proposals momentum and a real chance of being agreed.

Speaking ahead of the two-day meeting of G7 finance leaders, Mr Sunak said: "The G7 is a hugely important grouping and it's an honour to be welcoming my counterparts to London with a renewed spirit of multilateral cooperation."

"Even before holding the G7 presidency we've been clear on our priorities - protecting jobs, ensuring a green and global recovery and supporting the world's most vulnerable countries.

"Securing a global agreement on digital taxation has also been a key priority this year - we want companies to pay the right amount of tax in the right place, and I hope we can reach a fair deal with our partners.

"I'm determined we work together and unite to tackle the world's most pressing economic challenges - and I'm hugely optimistic that we will deliver some concrete outcomes this weekend."

The ministers will be looking at how to stop the likes of Google, Amazon, Starbucks and Apple paying low or no taxes in countries where they make revenues.

All G7 countries bar the UK have supported a proposal from the US for a global minimum corporate tax rate of 15% that could raise $50-$80bn for governments around the world.

However, the UK is holding out for reassurances about the Digital Services Tax, which levies 2% on revenues derived in the UK from online marketplaces, search engines and social media platforms.

The UK Treasury is open to the idea of a global corporate minimum tax rate and is said to be prepared to let the Digital Services Tax go if it obtains assurances that big tech will not simply be let off the hook.

The Biden administration initially pushed for a global minimum corporate tax rate of 21% but has now retreated to 15%. However, officials have said that's regarded very much as a "floor".

Finance ministers from the US, Japan, France, Canada, Germany and Italy will be attending the meeting at Lancaster House, along with representatives from the European Commission, the Eurogroup, the World Bank, the IMF and the OECD.

Mr Sunak is set to push his counterparts to follow the UK's lead on making climate reporting in the financial system mandatory.

Ministers will also hold meetings to discuss support for low-income countries and the global recovery post-Covid.

Newsletter

Related Articles

0:00
0:00
Close
Robots Compete in Football Tournament in China Amid Injuries
Trump Administration Considers Withdrawal of Funding for Hospitals Providing Gender Treatment to Minors
Texas Enacts Law Allowing Gold and Silver Transactions
China Unveils Miniature Insect-Like Surveillance Drone
OpenAI Secures Multimillion-Dollar AI Contracts with Pentagon, India, and Grab
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Elon Musk Critiques Senate Budget Proposal Over Job Losses and Strategic Risks
Los Angeles Riots ended with Federal Investigations into Funding
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Education Secretary Announces Overhaul of Complaints System Amid Rising Parental Grievances
Massive Anti-Government Protests Erupt in Belgrade
Trump Ends Trade Talks with Canada Over Digital Services Tax
UK Government Softens Welfare Reform Plans Amid Labour Party Rebellion
Labour Faces Rebellion Over Disability Benefit Reforms Ahead of Key Vote
Jeff Bezos and Lauren Sánchez Host Lavish Wedding in Venice Amid Protests
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
North Korea to Open New Beach Resort to Boost Tourism Economy
UK Labour Party Faces Internal Tensions Over Welfare Reforms
Andrew Cuomo Hints at Potential November Comeback Amid Democratic Primary Results
Curtis Sliwa Champions His Vision for New York City Amid Rising Crime Concerns
Federal Reserve Proposes Changes to Capital Rule Affecting Major Banks
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Trump Escalates Criticism of Media Over Iran Strike Coverage
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
Big Four Accounting Firms Fined in Exam Cheating Scandal
NATO Members Agree to 5% Defense Spending Target by 2035
Australia's Star Casino Secures $195 Million Rescue Package Amid Challenges
UK to Enhance Nuclear Capabilities with Acquisition of F-35A Fighter Jets
Russian Shadow Payments via Cryptocurrency Reach $9 Billion
Explosions Rock Doha as Iranian Missiles Target Qatar
“You Have 12 Hours to Flee”: Israeli Threat Campaign Targets Surviving Iranian Officials
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Airlines Evaluate Flight Cancellations Amid Escalating US-Iran Tensions
Starmer Invites Innovators to Join Government Talent Scheme
UK Economy’s Strong Opening Quarter Shows Signs of Cooling
Harrods Seeks Court Order to Secure Al Fayed Estate for Victims
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
×