The tax is one of Biden’s top priorities that the White House says would end the global race to the bottom on corporate tax rates. The new rule will be formalized when leaders issue a final G20 communiqué on Sunday, at the end of the summit.
All G20 leaders spoke in favor of a global minimum tax at the summit’s first session, a senior US administration official said.
“The president underlined the importance of this historic agreement during his speech,” the official said, referring to Biden’s turn to speak at the meeting. “The president also mentioned that even if we do not agree on all issues, we can tackle common interests.”
Italian Prime Minister Mario Draghi, this year’s G20 leader, said in remarks at the start of the summit that the deal was proof of the power of multilateralism.
“We have reached a historic agreement for a fairer and more efficient international tax system,” said Draghi, adding: “These results are a powerful reminder of what we can achieve together.”
The measure would tax large multinational companies at a minimum rate of 15% and require them to pay taxes in the countries where they operate. The Biden administration breathed new life into the global initiative earlier this year and garnered support from G7 countries in June, paving the way for a preliminary deal in July.
“In our opinion, this is more than just a tax deal. It is an overhaul of the rules of the global economy, ”said a senior administration official.
“These world leaders are really sophisticated. They understand. There is a complicated process in any democracy to do something as ambitious as the one we are pursuing in our national agenda,” said the senior administration official. “These are multigenerational investments and of course we are trying to reform the tax code to pay the price. And so, you know, I think there is going to be a broad understanding that takes time.”
As the day began with a victory for Biden, he faces a more skeptical global audience than he found the last time he visited Europe to meet with world leaders.
The president arrived at the summit site on Saturday morning, alighting from his car and greeting Draghi. Biden posed for a family photo with G20 leaders, as well as Italian medical workers who joined heads of state on the platform.
World leaders also spent Saturday afternoon discussing the Covid-19 pandemic, global supply chain issues, high energy prices and tackling the climate crisis, among other topics.
Biden spoke at the meeting and “reminded G20 leaders that new pandemics can arise at any time, so it is important that we strengthen global health systems and do more to build global infrastructure. security to make sure we are prepared against the next pandemic, ”the official said.
“The president stressed the need for balanced, well-supplied and competitive global energy markets so as not to undermine this critical moment of economic recovery,” the official said.
The official said Biden “also underscored his commitment to ending the global pandemic and ensuring an inclusive global economic recovery, including by supporting developing countries through debt relief.”
A senior administration official said on Friday that Biden would not get directly involved in OPEC decisions regarding the increase in supply: “We are certainly not going to get involved in the details of what is happening within the cartel, but we have a voice and we intend to use it on an issue that affects the global economy. “
“There are large energy producers who have spare capacity,” the official said. “And we encourage them to use it to ensure a stronger and more sustainable recovery around the world.”
The president is expected to hold additional bilateral meetings with world leaders while in Rome, although the White House has yet to make any firm announcements.