// ECONOMIC SECURITY: MACROECONOMIC AND FINANCIAL POLICY
Salvaged but not saved: how the
G7 can still shape the future of the global minimum tax
harbour’, although arguably necessary to avert the total collapse of the 2021 global tax regime – has created a stark asymmetry that has eliminated any prospect of a level-playing field. It was hoped that agreement on the Two Pillar Solution would end a four-decade race to the bottom in corporate taxation. However, five years on, the G7 has inherited a project that has been sal- vaged but not saved. A FRAGILE COMPROMISE The key question facing leaders meeting at the G7’s Évian Summit this year is not whether the global minimum tax can survive effective US with- drawal from Pillar 2. Rather, decision-makers must ask themselves whether the G7 will defend what remains and help underwrite the future integrity of the global corporate tax system. The G7 finance ministers set out the new SbS
The global minimum tax has avoided collapse, and the G7 must now decide whether to stabilise a fragmented system or restore its credibility
P illar 2 of the Organisation for Economic Co-operation and Development’s land- mark global tax deal signed in 2021 remains among the most consequential coop- erative tax achievements in recent history in avoiding base erosion and profit shifting. It is partly a G7 success story. However, when G7 leaders convened in 2025 for their 51st summit in Kananaskis, the world’s leading advanced democracies agreed to spare US companies from core parts of the global minimum tax. The resulting Side-by- Side framework – and its permanent US ‘safe
Michael Motala, director of taxation, G7 Research Group
42 // G7 FRANCE: THE ÉVIAN SUMMIT 2026
Made with FlippingBook - professional solution for displaying marketing and sales documents online