They accept a 15% global business tax

There Organization for Economic Co-operation and Development (OECD) signed a multilateral agreement with 138 countries, including Mexico, to charge global companies a 15% tax on your excess income.

In interview with The Herald of Mexico, Eugenio Grageda, a partner at Holland & Knight’s International Tax Practice, revealed that the deal is meeting resistance, particularly from the United States, where 60% of mega-corporations are located; however, the OECD expects that by the end of this year, even without that country’s signature, the tax will come into force.

The tax, said the specialist, should apply to foreign companies whose income is greater than 21.6 billion dollars (20 billion euros) and which also have a profit margin greater than 10%.

These global companies are going to have to distribute up to 25% of their annual surplus income, which, according to OECD calculations, in October 2021 could amount to 135.4 billion dollars (125 billion euros), he pointed out.

The condition for applying this tax to foreign companies, Grageda explained, “is that in the country where the product is sold, it has generated more than one million 83 thousand dollars (one million euros) in annual revenue”.

For example, he said “if Meta, Amazon, Procter & Gamble, Google, Netflix or Uber have annual sales of more than one million euros in Mexico, and as a group they have revenues of more than 21.6 billion dollars (20 billion euros), with a profit margin of more than 10%, these groups must distribute 25% of your residual income in the country where your product or service was sold, that is to say, in this case, Mexico”.

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Author: Yazmin Zaragoza
Source: El Heraldo De Mexico