Amazon Is Said to Be Included as Part of Global Tax Plan

Amazon is expected to be included in an international tax plan, even as the tech and retail giant doesn't specifically qualify, a media report says.
Author:
Publish date:

Amazon.com  (AMZN) - Get Report is expected to be included in an international tax plan, even as the Seattle tech and online-retail giant doesn't specifically qualify based on its profit margins, a media report says.

The finance ministers from the Group of Seven nations are negotiating rules that would allocate a portion of corporate profits above a 10% profit margin. Amazon has estimated its global operating margin this year at 7.1%.

Nonetheless, two people familiar with the talks told Bloomberg News that the talks are addressing how to include Amazon.

One way might be to target the more-profitable cloud-computing operations, instead of the whole company, which reflects thin retail profit margins, Bloomberg reported.

Broadly, the talks are designed to ensure that many of the largest companies pay taxes. 

Reuters reports that the current outdated tax policy can't address the question of how to tax multinational tech giants that sell services remotely and attribute much of their profit to intellectual property held in low-tax jurisdictions.

On Saturday the G7 advanced economies agreed to back a minimum corporate global corporate tax rate of at least 15%.

An Amazon spokesman referred Bloomberg to the company's Saturday statement supporting the G7 agreement.

Bloomberg quoted an Amazon spokesman as saying then that the process “will help bring stability to the international tax system” and describing Saturday’s deal as a “welcome step forward in the effort to achieve this goal.”