Connect with us

World

Can new EU corporate tax rules make big business pay its fair share?

Published

on

Can new EU corporate tax rules make big business pay its fair share?

A landmark global deal setting a minimum corporate tax rate of 15% on multinational companies came into force in the European Union on 1 January.

ADVERTISEMENT

The EU has for years tried to flex its muscles on corporate tax evasion by introducing a raft of new laws and lodging high-profile court cases against multinationals.

But some of its own member states – such as Ireland, Luxembourg and Cyprus – have continued to allow high-profit companies to dodge both taxes and scrutiny. Profit shifting worldwide has also remained high, causing losses worth billions of euros for the continent while economic inequality deepens.

Now, companies with revenues of at least €750 million active in any of the 27 EU states will face a minimum corporate tax rate of 15%. The bloc’s economy commissioner Paolo Gentiloni described the new year rules as “a new dawn for the taxation of large multinationals”.

The move is part of a sweeping overhaul of the global tax system agreed by some 140 Organisation for Economic Co-operation and Development (OECD) countries in 2021 after a decade of negotiations, and aims to crack down on governments that slash their corporate tax bills to attract investment.

Other countries such as the UK, Norway, Australia, Japan and Canada are also implementing the measures.

Advertisement

While the new interlocking rules have been hailed as groundbreaking, experts told Euronews there is a need to close crucial loopholes to ensure big business is held accountable.

A ‘revolution’ in tax justice

The OECD deal consists of two pillars, the first of which aims to ensure companies pay tax where they do business. The second pillar sets the global minimum tax rate of 15%. 

In an interlocking system hailed revolutionary, if one country fails to tax a multinational at this rate, other countries can charge a so-called “top-up tax”.

This does not mean EU countries will necessarily adjust their corporate tax rate to the 15% baseline, since other countries will be able to step in to collect the taxes due from multinationals that pay their levies in low-tax jurisdictions.

This means that in a hypothetical scenario, a French multinational operating in Senegal and shifting its profits to Ireland could see either France or even Senegal charge a top-up tax if it doesn’t pay the minimum rate of 15% in Ireland.

Advertisement

“The concept is revolutionary,” according to Quentin Parrinello, a senior policy adviser at the EU Tax Observatory.

“It’s the first time we have more than 140 countries, including all major economic actors, agree that multinational companies should pay a minimum amount of tax on the profits it reports.”

“There is, in theory, no incentive for a country not to apply the minimum tax because if they don’t, another country will get the tax revenues,” Parrinello added.

Most EU countries have already transposed the EU Directive – that makes the new rules a reality – into law. Five countries – Estonia, Latvia, Lithuania, Malta and Slovakia – have informed the European Commission that they will delay implementation as they have fewer than twelve affected multinationals operating within their borders.

Too many loopholes

But despite its promise, experts fear the reform alone cannot stamp out tax havens or prevent a so-called ‘race to the bottom’ of harmful tax competition between governments.

Advertisement

States can still abide by the new minimum rate whilst offering generous tax credits and other deductions that effectively reduce the tax rate below 15%. Many states are already introducing attractive transferable credits, grants and subsidies to compete for investment.

“We already see this, for example with the IRA (Inflation Reduction Act) in the US. We also have countries such as Ireland, Switzerland, and the Caymans already thinking of their own systems,” Parrinello explained.

Another loophole in the deal allows firms to exclude certain amounts of profits – equal to 8% of the value of tangible assets and 10% of payroll in the first year – from the tax base. 

ADVERTISEMENT

The EU Tax Observatory estimates that this loophole could cost the EU some €26 billion in its first year of implementation. A loophole-free 15% minimum tax could have raised around $95 billion (€87 billion) in the bloc in 2023, the watchdog says, dropping to just $67 billion (€61 billion) with the current design. 

“There will not be an end to harmful tax competition and the race to the bottom on taxation,” Chiara Putaturo, Inequality and Tax Policy Advisor at Oxfam’s EU office, said.

“We are seeing a lot of countries like Ireland, Switzerland and also Bermuda changing some of the tax systems they had before to introduce generous refundable tax credit so that they will still be able to have a lower and lower tax rate,” she added.

Advertisement

“The minimum tax is a floor,” Parinello said. “It’s much better to have a floor than nothing. But if you drill holes in the floor, you weaken the overall structure.”

World should move in lockstep

The OECD-designed system is unique in the way it incentivises all world nations to move in lockstep. Countries infamous for attracting giant companies with attractive tax incentives – such as Barbados and Panama – are also signatories.

ADVERTISEMENT

An overwhelming majority of Swiss voters (78.5%) also backed the new rules in a consultation last June, putting pressure on their government to swiftly adopt the rules. 

The US and China have not yet passed the necessary legislation but are likely to be incentivised to do so to ensure other countries do not top up their own tax collections at their expense. 

But Putaturo warned that the 15% rate, which is lower than the global average, lacks ambition.

“The majority of countries, globally, have an effective tax rate which is higher than 15%. So this could even bring some countries to lower their tax rate, in a race to the minimum rather than a race to the bottom,” Putaturo explained.

Advertisement

“The minimum tax also does almost anything in terms of the redistribution of tax revenues. The so-called resident countries, where multinationals are headquartered, will have the right to top up the tax to 15% if the tax haven does not collect the tax due. This is a problem for poorer countries because the resident countries are mainly rich countries,” she added.

ADVERTISEMENT

World

Video: A Small Election Could Change British Politics

Published

on

Video: A Small Election Could Change British Politics

new video loaded: A Small Election Could Change British Politics

transcript

transcript

A Small Election Could Change British Politics

Voters in the northern English district of Makerfield cast ballots on Thursday to choose their representative in Parliament, the outcome of which could lead to Prime Minister Keir Starmer’s ouster.

Well, I don’t think there should be a leadership election. I think that the last government proved that parties that spend their whole time in leadership elections don’t go on to win the next general election.

Advertisement
Voters in the northern English district of Makerfield cast ballots on Thursday to choose their representative in Parliament, the outcome of which could lead to Prime Minister Keir Starmer’s ouster.

By Alisa Shodiyev Kaff

June 18, 2026

Continue Reading

World

From bear hugs to handshakes: How India lost its edge with Trump while Pakistan quietly gained ground

Published

on

From bear hugs to handshakes: How India lost its edge with Trump while Pakistan quietly gained ground

NEWYou can now listen to Fox News articles!

This week, President Donald Trump and Indian Prime Minister Narendra Modi came face-to-face at the G7 summit in France, their first such encounter since February 2025. Rather than his trademark bear hug, Modi greeted Trump with a smile and handshake.

Then on Wednesday, the two held a bilateral meeting. It was a friendly chat, but one that came against a backdrop of compounding tensions.

As India works at restoring its relationship with Washington, its arch-foe Pakistan has expanded its own diplomatic profile, complicating India’s campaign against its nuclear-armed rival.

COMMERCE SECRETARY HOWARD LUTNICK MAKES QUIET TRIP TO INDIA DAYS AFTER TARIFF SETBACK

Advertisement

President Donald Trump looks at Pakistan’s Prime Minister Shehbaz Sharif speaking following the official signing of the first phase of the Gaza ceasefire agreement between Israel and Hamas. Shariff announced his intention to nominate Trump for the Noble Peace Prize for a second time.  (Evelyn Hockstein / Reuters)

For years, India built an international case against Pakistan, projecting it as an isolated or destabilizing state. This hardline stance appeared to be working, with Modi declaring to Pakistan, “India has been successful in isolating you, and we will intensify those efforts.” 

But a decade later, Pakistan is rapidly emerging as a key global player in the region and beyond.

While Modi initially tried to engage Pakistan, his government’s approach eventually hardened around the mantra that “terror and talks cannot coexist.”

In Washington, India has typically been favored, with Presidents Trump, Biden, Obama and George W. Bush all making visits during their time in office.

Advertisement

President Donald Trump (R) shakes hands with Indian Prime Minister Narendra Modi during a bilateral meeting at the G7 Summit on June 17, 2026 in Evian-les-Bains, France.  (Anna Moneymaker/Getty Images)

Modi built a rapport with Trump during his first term in office and was one of the first world leaders invited to the White House after Trump’s inauguration. But over the past year, that relationship has come under strain as Islamabad quietly clawed its way back to credibility.

“India misjudged Trump in term two, banking on once friendly relations,” Sid Dubey, a visiting professor at Bennett University in India, told Fox News Digital. “They have yet to start recovering from that.”

PRESIDENT TRUMP, INDIA’S MODI TO TACKLE TRADE, TARIFF TENSIONS AT HIGH-STAKES MEETING

U.S. President Donald Trump and Indian Prime Minister Narendra Modi wave to the crowd at Sardar Patel Stadium in Ahmedabad, India, Monday, Feb. 24, 2020. India poured on the pageantry with a joyful, colorful welcome for President Donald Trump on Monday that kicked off a whirlwind 36-hour visit meant to reaffirm U.S.-India ties while providing enviable overseas imagery for a president in a re-election year. (AP Photo/Aijaz Rahi)

Advertisement

The shift first became apparent in May 2025, when President Trump announced he had secured a ceasefire between nuclear-armed India and Pakistan. The fighting had come over India-administered Kashmir and was the worst in decades.

Islamabad promptly praised Trump for ending the deadly dispute and even nominated him for a Nobel Peace Prize. New Delhi, however, rejected the claim, insisting the ceasefire was the result of direct bilateral talks with Pakistan.

The response reflected India’s long-standing sensitivity to third-party involvement in what it fiercely maintains is a bilateral dispute.

In the months that followed, frictions only deepened.

FILE — In this Jan. 11, 2013 file photo, a Pakistani Ranger in black uniform and his Indian counterpart march during a flag-off ceremony, at the joint Pakistan-India border check post of Wagah near Lahore, Pakistan. (AP Photo/K.M. Chaudary, File)

Advertisement

President Trump hit India with some of the steepest tariffs imposed on any major economy. Meanwhile, U.S. sanctions pressure on Russian oil rattled energy import-dependent India, while disputes over H-1B visas added further strain. Analysts say Trump’s America First agenda increasingly overshadowed the friendship Modi had cultivated during Trump’s first term.

“When Trump unfortunately said the May 2025 clash ended because of him personally, that upset India a lot, and they made that known,” Dubey said. “Then the tariffs were another slap in India’s face. Meanwhile, Pakistan took advantage, leaving India at a bit of a loss. From there, relations fell further with the Iran conflict.”

India is among the countries most indirectly affected by the strategic fallout from the Iran war, facing economic pressure and mounting energy concerns.

IRAN WAR FUELS ASIA ENERGY CRUNCH AS INDIA, JAPAN, OTHERS FEEL STRAIN

Iranian Parliament Speaker Mohammad Bagher Ghalibaf meets with chief of Defence Forces of Pakistan, Field Marshal Asim Munir, in Tehran, Iran, May 23, 2026. (Iranian Parliament Speaker Office/WANA (West Asia News Agency)/Handout via Reuters)

Advertisement

Last week, a U.S. strike further exacerbated tensions after three Indian seafarers became collateral damage in the conflict. They were the first and only seafarers confirmed killed as part of the U.S. blockade, sparking outrage across India.

New Delhi instantly summoned Washington’s Chargé d’Affaires Jason Meeks, expressing deep concern over the renewed attacks and arguing that its nationals were becoming casualties in a war not their own.

India also warned of the broader humanitarian, economic, and energy consequences of the conflict, which are expected to linger even as an agreement has now been reached.

U.S. Vice President JD Vance, center, walks with Pakistan’s Chief of Defence Forces and Chief of Army Staff Field Marshall Asim Munir, left, and Pakistani Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar after arriving for talks with Iranian officials in Islamabad, Pakistan, Saturday, April 11, 2026. (Jacquelyn Martin/Pool via AP Photo)

All the while, Pakistan was gaining diplomatic visibility, finding itself in the unusual position of currying favor in Washington while maintaining deep ties with China, Iran and the Gulf states.

Advertisement

Pakistan’s prominent role in recent months highlighted how Islamabad has been more nimble in its diplomacy than India,” Council on Foreign Relations Senior Fellow Sadanand Dhume told Fox News Digital. “Additionally, Pakistan decisively outmaneuvered India’s quixotic bid to isolate Pakistan on the world stage.”

Regional dynamics have also been reshaped by the two rivals’ competing strategies. India has deepened its strategic partnership with the U.S. through alliances such as the Quad partnership with the U.S., Australia, and Japan and has expanded cooperation across South Asian states, including a burgeoning relationship with Afghanistan. Meanwhile, Pakistan’s growing regional relevance has been reflected in its strengthened ties with China, improved relations with regional partners like Bangladesh and expanded security cooperation with Gulf states.

RUBIO VISIT TO INDIA PUSHES DEEPER ENERGY TIES AS IRAN CONFLICT RATTLES GLOBAL OIL MARKETS

Additionally, Trump, who accused Pakistan of “deceit and lies” during his first term, has since repeatedly praised its leadership. In June 2025, the president invited Pakistan’s army chief Asim Munir to the White House for a high-profile lunch meeting.

Munir was the first Pakistani military chief who was not also president to be hosted by a U.S. president. He also led the war effort against India earlier that year. 

Advertisement

In this photo released by the Inter Services Public Relations, Pakistan’s Chief of Defense Forces and Army Chief Gen. Asim Munir, center, Pakistan Naval Chief Admiral Naveed Ashraf, left, and Pakistan Air Force Chief Air Chief Marshal Zaheer Ahmed Babar attend a guard of honor ceremony at the joint military command headquarters in Rawalpindi, Pakistan, Monday, Dec. 8, 2025.  (Inter Services Public Relations via AP)

Trump described Munir as his “favorite Field Marshal” and an “exceptional human being.” 

Their relationship has been further reflected in trade deals and, most recently, Pakistan’s role as a principal mediator in restoring diplomacy between the U.S. and Iran.

“India tried to make Pakistan an international pariah. Instead, Pakistan has wormed its way into Trump’s good books through a combination of concrete co-operation with the U.S. and outrageous flattery of the president, leading to Trump elevating Field Marshal Asim Munir and Prime Minister Shehbaz Sharif as heroes,” Dhume said.

India, meanwhile, has maintained close ties with Israel while generally sticking to more measured messaging. 

Advertisement

TRUMP’S FAVORITE FIELD MARSHAL: WHO IS PAKISTAN’S POWERFUL ARMY CHIEF ASIM MUNIR WITH DEEP INTEL TIES

On June 15, upon the agreement of a deal with Iran, Modi released a statement, saying, “India hopes that the implementation of this understanding will help restore peace and stability in the region and ensure the freedom of navigation and commerce.”

“Hats off to Pakistan. They worked really hard to bring this awfully disruptive war with Iran to an end,” Dubey told Fox. “India unfortunately lost out by not seeking to be a problem solver like Pakistan. It could have played its cards better as a peacemaker, given its traditionally strong relations with Tehran.”

Still, analysts caution these are rapidly evolving dynamics. There is no guarantee that Pakistan’s current moment will last, and the tide for India could still turn.

“Pakistan’s mediation role has allowed it to substantially reset its international image. It has positioned itself as a responsible international actor rather than a rogue state responsible for both nuclear proliferation and exporting Islamic terrorism. How long this lasts depends in large measure on two things: will Pakistan find a way to remain in Trump’s good books, and will it be able to change its behavior sufficiently to convince the world that it has indeed turned over a new leaf,” Dhume told Fox News Digital.

Advertisement

Meanwhile, India is working to regain its position and show the U.S. it is still a reliable partner.

Marco Rubio visited India last month, his first since becoming Trump’s top diplomat last year, which was widely seen as an attempt to reset ties. 

Secretary of State Marco Rubio speaks as President Donald Trump looks on during a cabinet meeting in the Cabinet Room of the White House in Washington, DC, on April 30, 2025.  (JIM WATSON/AFP via Getty Images)

Trump and Modi’s G7 meeting marked another significant step. 

Trump praised Modi as “calm, cool and totally killer” and said he would be traveling to India “sometime in the future.” India has been pressing Trump for a visit, potentially as part of a broader meeting involving Japan and Australia.

Advertisement

Trump also said the United States would defend India.

CLICK HERE TO DOWNLOAD THE FOX NEWS APP

“If anybody attacks that man, we’re going to be there,” Trump said, referring to Modi. “Now, if there’s a new leader, I’m not sure about it.”

The Pakistani and Indian governments did not respond to Fox News Digital requests for comment.

Advertisement
Continue Reading

World

EU of six, not 27, is needed to ‘stay relevant’ – Bruno Le Maire

Published

on

EU of six, not 27, is needed to ‘stay relevant’ – Bruno Le Maire

Working with a coalition of six core European countries instead of 27 is the best way to reinforce Europe, former French Economy Minister Bruno Le Maire told Euronews on the sidelines of the G7 summit in Évian, France.

ADVERTISEMENT


ADVERTISEMENT

His comments come as the European Union looks for ways to streamline its decision-making process and become more agile on key issues from defence to foreign policy.

“The single lesson that all the European leaders must draw from the past months, and I would say from the last two years, is that if they want to be relevant and strong, they need to be united. And they don’t need to unite with 27 member states,” he said in a Euronews interview.

“They need to give a new impetus to the European construction by building a European [project] with six core countries,” Le Maire, who was the longest-serving economy and finance minister since World War II and the shortest-serving minister for armed forces, note

Advertisement

Le Maire listed France, Germany, Italy, Spain, Poland, and the Netherlands — the EU’s six largest economies — as the states that should band together to discuss key issues facing the bloc, ranging from the Iran conflict and support for Ukraine to chip manufacturing on European soil and nuclear energy.

“Six countries instead of 27 countries is the best way of reinforcing Europe, of facing the threats posed by many empires around the world, and getting some concrete results,” he said.

Le Maire pointed to the pressure from the US administration against the EU, including tariffs and threats over regulatory standards, in response to Brussels’ antitrust fines and digital regulations targeting American tech giants like Google and Amazon.

“We can no longer accept being blackmailed […]. The way President Trump and the US administration are saying, ‘You should get rid of the taxation of Google, Amazon, Facebook, and Microsoft, otherwise, I will hit you with new tariffs,’ is 100% unacceptable among allies,” he said.

“If we want to resist that kind of threat, that kind of blackmail […] the six strongest European member states must stand united […]. If we are divided, you cannot resist that pressure,” he said.

Advertisement

“If you stand united, explaining that it will be difficult for the US to gain access to the European market if they do not respect Europe as a partner, that is the best way of getting some concrete results.”

Too much talk, too few decisions

Often held up by a principle of unanimity, Le Maire told Euronews that involving 27 countries to form a consensus on EU decision-making means “long talks and very few decisions”, while what is needed now is “strong decisions and fewer talks.”

He envisioned a structure in which the six core countries move forward on matters, and “then the 21 other member states, if they want to join, they will join,” adding, “first of all, let’s move on.”

The idea of this coalition is not new. In fact, it already exists in some shape or form.

Earlier this year, the finance ministers of Germany, France, Italy, the Netherlands, Poland and Spain launched a new coalition, dubbed the “E6”, to push for “decisive action and swift progress” in four strategic areas: defence, supply chains, the Savings and Investments Union, and strengthening the euro internationally.

Advertisement

“We are providing the impetus, and other countries are welcome to join us,” German Finance Minister Lars Klingbeil said at the time. The President of the European Commission, Ursula von der Leyen, endorsed this two-speed Europe concept as a way of bolstering the European economy.

In May, the E6 signed a joint letter calling for an acceleration of the Capital Markets Union (CMU) in an attempt to get a deal through a politically stagnant Brussels.

The CMU aims at creating a single, integrated market for capital across all 27 member states to service companies, investors and consumers.

Advertisement
Continue Reading
Advertisement

Trending