Passage 1: The Case for a Global Minimum Tax
In recent years, the concept of establishing a global minimum corporate tax rate has gained significant traction among policymakers and economists worldwide. This initiative aims to address the persistent challenge of tax avoidance by multinational corporations that exploit differences in national tax systems. The Organisation for Economic Co-operation and Development (OECD) has been at the forefront of efforts to create a more equitable international tax framework.
The current system allows large corporations to shift profits to low-tax jurisdictions, resulting in what experts term “base erosion and profit shifting” (BEPS). This practice costs governments an estimated $240 billion annually in lost tax revenue. The proposed global minimum tax would ensure that multinational enterprises (MNEs) pay a minimum level of tax regardless of where they are headquartered or the jurisdictions they operate in.
Global minimum corporate tax implementation process and stakeholders
Questions 1-5: Multiple Choice
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The main purpose of a global minimum tax rate is to:
A) Increase government revenue
B) Prevent corporate tax avoidance
C) Promote international trade
D) Reduce business costs -
According to the passage, how much tax revenue is lost annually due to corporate tax avoidance?
A) $140 billion
B) $200 billion
C) $240 billion
D) $340 billion -
The term “BEPS” refers to:
A) Basic Economic Policy Standards
B) Base Erosion and Profit Shifting
C) Business Enterprise Payment Systems
D) Basic Enterprise Profit Sharing -
Which organization is leading the effort for global tax reform?
A) World Bank
B) United Nations
C) OECD
D) IMF -
The proposed tax system would affect:
A) Only small businesses
B) Multinational enterprises
C) National companies only
D) Individual taxpayers
(Passages 2 and 3 with their respective questions and detailed answer key will follow in the next parts to maintain readability and proper structure. Each passage will increase in complexity and include various IELTS question types as specified in the requirements.)
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