Amazon Web Services in crosshairs as global corporate tax rules are agreed

Amazon’s cloud-computing and website hosting business is in the crosshairs as G7 finance ministers seek a crackdown on corporate tax for multinational tech giants in particular.

New efforts by the G7 nations want to set a minimum corporate tax for companies which spread their accounts around the world in order to pay less tax.

Finance ministers over the weekend agreed to a global minimum rate of 15% and agreed to mandate that some portion of tax must be paid in the country where transactions take place, rather than where the seller is headquartered (once certain thresholds are met).

Amazon’s US$45bn a year cloud business AWS would potentially slip by the new measures but for a special measures being discussed to specifically target the business, according to a report in the Financial Times.

If ratified and put in place, the G7 decision is expected to benefit the United States significantly given that many major multinationals operate from the US but are ‘based’ elsewhere for tax reasons, and, at the same time it the largest market in the West for online services.

Story by ProactiveInvestors