Yellen: Compete on economic strengths, not low tax rates

U.S. Treasury Secretary Janet Yellen says a proposed global minimum corporate tax would let countries compete on the strength of their economies rather than on who can offer the lowest tax rate

U.S. Treasury Secretary Janet Yellen said Sunday that deterring the use of tax havens will let countries compete on economic fundamentals — instead of by offering ever-lower tax rates that deprive governments of money for infrastructure and education. Yellen spoke after finance ministers from the Group of 20 major economies endorsed a global minimum corporate tax of at least 15%, a measure aimed at putting a floor under tax rates and discouraging companies from using low-rate countries as tax havens. “This deal will end the race to the bottom,” she said at a news conference after the end of the meeting in Venice. “Instead of asking the question: ‘Who can offer the lowest tax rate?,’ it will allow all of our countries to compete on the basis of economic fundamentals – on the skill of our workforces, our capacity to innovate, and the strength of our legal and economic institutions.”