MEDIA RELEASE: Canada would gain extra $11 billion annually from Biden 21% global minimum corporate tax

OTTAWA – Canada would gain at least $11 billion per year in corporate tax revenue from a global minimum tax rate at 21% as proposed by US President Joe Biden, according to a study released today by international corporate tax experts.

“Canada shouldn’t sit on the sidelines while the world gets serious about fighting corporate tax-dodging,” said economist Toby Sanger, Executive Director of Canadians for Tax Fairness. “Significant reforms to ensure large multinational corporations pay their fair share of taxes would both fix a broken international tax system and raise many billions that could help pay for the pandemic and recovery.”

"We clearly show how a 20 to 30 per cent minimum global tax rate would substantially increase revenues for every country we studied, except the worst tax havens,” said report co-author Alex Cobham, Chief Executive of the UK-based Tax Justice Network (https://www.taxjustice.net/).

Canada is involved in far-reaching negotiations through the G20 and OECD to reform an international corporate tax system that is widely considered to be broken, as it allows many of the largest multinational corporations in the world to pay very low rates of tax. One reform being considered is agreement on a global minimum corporate tax rate that would apply to the undertaxed profits of multinational corporations. This is what Biden’s proposed 21% minimum tax rate would apply to.

The US has also proposed other substantial reforms to prevent tax dodging. Meanwhile, Canada has remained silent, even though we have a domestic system that could be a model for the world.

“It’s time Canada takes a stand to support substantial and equitable reforms to ensure multinational corporations pay their fair share of taxes in Canada and around the world,” concluded Sanger.

Estimates of revenues that individual countries would gain from several global minimum corporate tax rates are included in a paper by international corporate tax experts published today by Charles University and are available at: https://ies.fsv.cuni.cz/sci/publication/show/id/6412/lang/en

Canadians for Tax Fairness published a brief report summarizing these results for Canada, with additional background, available at: https://www.taxfairness.ca/en/resource/canada-could-gain-11-billion-bide...

Media Contacts:
Toby Sanger, Executive Director, Canadians for Tax Fairness; 613-720-6955; toby.sanger@taxfairness.ca
Darren Shore, Communications Coordinator, Canadians for Tax Fairness; 438-880-1114; darren.shore@taxfairness.ca

Canadians for Tax Fairness is a non-profit organization that advocates for progressive taxes to fund important public services, reduce inequality and strengthen the economy.

Published: 12 April 2021

English