G7 finance ministers meet in London to broker global tax deal

Finance ministers from the G7 group of rich nations will meet in London on Friday for two days of talks aimed at moving closer to a global deal to raise more tax from the likes of Google, Facebook and Amazon.

The gathering, chaired by British finance minister Rishi Sunak, will be the first time all seven ministers will meet face-to-face since the start of the coronavirus pandemic.

US President Joe Biden’s willingness to raise taxes on large businesses also creates more chance of an international consensus than under his predecessor Donald Trump.

“I’m hugely optimistic that we will deliver some concrete outcomes this weekend,” Sunak said in a statement released late on Thursday.

Sunak stressed the importance of his fellow ministers from the United States, Japan, Germany, France, Italy and Canada being able to meet face-to-face in Lancaster House, an ornate 19th-century mansion almost next door to Buckingham Palace.

“You need to be round a table, openly, candidly talking through things,” Sunak told Reuters in an interview this week.

Due to COVID restrictions, ministerial delegations have been cut down and there are few traveling journalists. Seating plans have been redesigned with the help of public health officials.

But the bigger challenge remains reaching an agreement on tax reform which could then be presented to a broader group of countries, the G20, at a summit in Venice in July.

French finance minister Bruno Le Maire said ahead of the meeting that an agreement would be a “decisive step” which he thought was “within reach”.

However, Japanese finance minister Taro Aso said on Monday that he did not expect agreement this week on a specific minimum tax rate.

The US Treasury expects a fuller agreement to come when Biden and other heads of government meet at a secluded beach resort in southwest England on June 11-13.