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France says India, Saudi Arabia, and the United States are blocking pillar one.

According to French Finance Minister Bruno Le Maire, the EU should not rule out adopting pillar one alone if global talks fail.

On February 20th, at a press conference in Paris, French Economy and Finance Minister Bruno Le Maire alleged that India, Saudi Arabia, and the United States are blocking pillar one.


Le Maire stated, "We’ll call for the situation on pillar one to be unblocked, but the chances of success are slim. Today, things are blocked, notably by the United States, Saudi Arabia and India."


"This calls for a digital tax to be extended to a European level as soon as possible" he continued.


France has been instrumental in pressuring the OECD to pursue international tax reform. In 2019, President Emmanuel Macron introduced a 3% digital services tax (DST) to put pressure on the organization to find a multilateral solution to the online economy's issues.

Le Maire underlined that the lack of a strong majority in Congress could make it difficult for the United States to pass the first pillar. In order for the first pillar to become a reality, the US Senate must accept revisions to US tax treaties with a two-thirds majority.


The United States endorsed the two-pillar plan to stop the global spread of DSTs and convince nations to rescind such measures. But, pillar one is significantly more controversial than pillar two about the 15% global minimum corporate tax rate.


Le Maire has reaffirmed that France will support the first pillar at the EU level in the absence of a worldwide agreement. According to Le Maire, the French administration is still attempting to reach an agreement on the provisions of pillar one.


According to reports, Saudi Arabia is concerned about the scope of exemptions for extractive industries in pillar one. In addition, India intends to expand the tax capacity support mechanism for developing countries.


The finance ministers are scheduled to examine the recommendations during the G20 meeting in India from February 23 to February 25.

By fLEXI tEAM


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