The world’s richest economies need to work more closely to combat tax evasion by multinational companies, finance ministers and central bankers said at the G20 meeting in China Saturday.
Allegations of tax dodging by iconic companies like Apple and Starbucks have raised the issue in recent years, highlighted in probes by Margarethe Vestager, the European commissioner for competition. But taking on the issue is sensitive, as many of the firms targeted are American, and they have shifted their tax homes to places in Europe like Ireland.
“When the current cross-border tax rules were developed they were tied to concepts that reflected geography and national boundaries,” U.S. Treasury Secretary Jacob Lew told G20 finance ministers meeting in the Chinese city of Chengdu, according to the news wire.
“There needs to be a common standard across countries on important issues of transfer pricing,” he added at a tax policy event, adding that countries had to deal “collectively” with issues that lead to non-taxation.
Ministers were also expected at the meeting to say they had the tools to deal with the economic fallout from the Brexit vote, according to a document seen by Bloomberg.
But the recovery remains less than ideal, and the benefits of growth should be shared more widely, according to a draft communique seen by Reuters.