The global corporate tax rate: crypto savior or killer?
June 10, 2021. Summarized by summa-bot.
Compression ratio: 22.3%. 1 min read.
The G7 agreed on a new global corporate tax rate. What is the possible impact for crypto?
Under all of this, the new rules will focus on where the profit was made and not where the company is based — the idea being that companies are discouraged from moving money around the globe, or providing services in one country from another that has a cheaper tax rate.
The practice of making money in one country and then moving it to another in order to pay less taxes or avoid them all together is perfectly legal, mostly.
Yet, in most countries, it pays less tax than the average domestic company.
The feeling is that crypto companies who operate internationally will have to do one of two things: Either be prepared to pay a corporate domestic rate of 15% all over the globe, or move their physical location to a truly international location.
Likewise, countries such as Singapore and Ukraine have excellent tax rules for companies simply looking to do business there with minimal presence.
If, upon deployment of the new rules, the taxes are massively overbearing, many may wish to look at new locations and physical offices — especially those who make more than 10% profit and, more importantly, those who conduct business in one location with good taxes, but have their physical offices in another location.