WATCH: Global minimum tax proposal misses the mark

Corporate taxation is one of the thorniest issues in international economic policy. Janet Yellen, US President Joe Biden’s treasury secretary and a former head of the US Federal Reserve weighed in when she grabbed the attention of the occupants of corner offices worldwide with a speech to the Chicago Council on Global Affairs earlier this month.

The headline was a call for countries to agree on a global minimum tax rate for large companies. Over the past decade, growing corporate tax avoidance (driven by well-known international economic factors) has met with a growing public backlash. It has an understandable moral clarity, apart from the loss of revenue. Hence the renewed debate on a global minimum corporate tax rate.

However, accepting that there is a real problem about the erosion of domestic tax bases, the question is how the various competing national interests can negotiate a sensible compromise by June this year, given the complexities.

Michael Avery speaks to Sars Commissioner Edward Kieswetter; retired judge Dennis Davis, head of the Davis Tax Committee; and Keith Engel, CEO of the SA Institute of Tax Professionals.