Many major multinational companies must pay a global minimum tax of at least 15% on corporate profits for the first time. The historic tax reforms went into effect on Monday, nearly three years after 140 countries agreed to a new tax system, which is expected to increase tax revenues by $220 billion a year.

The United States is not currently participating in the reform despite having endorsed the agreement in 2021.

Countries that have implemented the 15% tax since 1 January include the UK, Australia, South Korea, Japan and Canada, as well as the European Union and countries known as tax havens, such as Ireland, Luxembourg, the Netherlands, Switzerland and Barbados.

The global corporate tax think tank Centre for International Corporate Tax Accountability and Research said the new global minimum tax “will reduce incentives for companies to use tax havens and incentives for countries to be tax havens […] and will concretely slow down what was a race to the bottom”.

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