FirstFT: The battle to win over global tax deal holdouts


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Negotiators in Paris are battling to persuade holdout nations to sign up to a global deal on corporate taxation this week as they become increasingly concerned that the compromises needed to get countries on board will water down the final agreement.

China, India, eastern European countries and developing nations have all raised objections to the deal struck by the G7 group of leading economies this month. The talks at the OECD are seeking to find carve-outs to bring them on board.

Tax havens and investment hubs such as Ireland, Switzerland and Barbados are widely expected to refuse to sign up to the deal, according to some of those involved.

The details of the proposals will be discussed by finance ministers from the G20 group of countries at a summit in Venice next month. Those with knowledge of the process have become more hopeful about getting a deal, and especially about China agreeing to participate, but warned that time was short.

Five stories in the news

1. Declan Kelly resigns as Teneo chief The influential adviser to many Fortune 500 chief executives has resigned as head of the communication firm Teneo. His exit comes five days after the Financial Times revealed that Kelly had inappropriately touched a number of women without their consent at Global Citizen’s Vax Live concert in California on May 2.

2. US home prices rise at fastest pace in more than 30 years US home price growth accelerated in April at the fastest pace in more than three decades as strong housing demand continued to come up against a shortage of residential properties. The S&P Case-Shiller national home price index, which covers all nine US census divisions, rose 14.6 per cent year on year in April, data on Tuesday showed.

3. Father-son pair apologise for aiding Ghosn’s escape Michael Taylor, the 60-year-old former US Green Beret, has apologised to Japan for orchestrating Carlos Ghosn’s elaborate escape to Lebanon, saying he acted out of sympathy for the former Nissan chair after hearing his claims of “psychological torture”. There was a similar apology from his son, Peter.

4. South Korea’s ex-top prosecutor launches bid for presidency Yoon Seok-youl has emerged as a popular opposition figure after resigning in March following clashes with President Moon Jae-in over justice system reforms. His campaign to become president of Asia’s fourth-biggest economy will focus on discontent over rising inequality and corruption allegations.

5. South Africa’s top court orders Jacob Zuma to go to jail South Africa’s top court has sentenced former president Jacob Zuma to 15 months in prison for contempt of court after defying an order to attend an inquiry into allegations of corruption under his presidency. Zuma must turn himself in to police within five days.

Coronavirus digest

  • India approved Moderna’s vaccine as its fourth dose for emergency use to boost its inoculation campaign in the wake of a devastating second wave.

  • Countries across the Asia-Pacific region are going back into lockdown to combat the spread of the Delta variant.

  • The city Guangzhou, which has received many of China’s visitors during the pandemic, is building a quarantine hotel near the airport.

  • United Airlines has placed an order for 270 jets, the biggest in the airline’s history, in a bet on a resurgence of premium travel after the pandemic.

  • The UK is to offer coronavirus vaccines to thousands of delegates from nearly 200 countries ahead of the UN climate summit in Glasgow in November. (FT, NYT)

For the latest coronavirus news, follow our live blog and sign up for our Coronavirus Business Update newsletter.

The day ahead

Didi’s New York IPO China’s ride-hailing app Didi will make begin trading on the New York Stock Exchange on Wednesday after defeating Uber and becoming dominant on the streets of the country’s main cities, but with worries over growth and regulation on the horizon. (FT, Reuters)

Column chart of Sector’s contribution to group’s total sales (%) showing Didi's revenues breakdown

US-Taiwan trade talks Taiwan and the US will discuss supply chain security and digital trade in their first trade talks in five years, which kick off on Wednesday. The countries are seeking to deepen economic ties in the face of growing tension with China. For the latest developments in global trade sign up for our Trade Secrets newsletter.

Eurozone inflation data Figures due to be published on Wednesday are expected to show a modest dip from 2 per cent in May to 1.9 per cent in June. The ECB targets inflation of just below 2 per cent.

Join senior sports leaders on July 15 as they discuss the opportunities the Africa-US football ecosystem can provide for talent development and what it means for the future of the sport globally.

What else we’re reading

What’s fuelling China’s new online nationalists Chinese nationalist sentiment has become even more prominent online in recent years, especially on Weibo. It used to be outsiders, a US politician criticising the government for instance, who received the worst of the attacks from bloggers. Now insiders bear the brunt.

Reflation trade unwind wrongfoots big-name hedge funds Betting against the price of US government bonds was a winning play earlier this year. But recent gyrations and the spectre of a policy pivot from the Federal Reserve have heaped significant doubt on whether investors should remain in the trade.

  • Opinion: Should central banks do something about inequality and, if so, what? This has become a hot topic, writes Martin Wolf. But the necessary structural reforms will be harder than many economists imagine.

Iran’s hardliners weigh social freedoms for stability Civil disobedience is rippling through Iranian society. If the schism between people and leaders continues to widen and economic malaise goes unfixed, the regime’s greatest fear could be realised: an explosion of social unrest akin to that which ousted the last shah and brought the clerics to power in 1979.

Taiwan’s unity cracks under Chinese disinformation onslaught Experts have registered a sharp increase of Chinese information operations targeting Taiwan since the beginning of the pandemic last year, but following the recent start of increasing infections and deaths, those attacks have started to sting, writes Kathrin Hille.

Long live the (reconfigured) office I don’t think I am the only one to find I can do some elements of my job more effectively from home — a fact that tells us something important about the design of the 21st-century office. The pandemic gives us a chance for a fresh start, writes Sarah O’Connor.

Wellbeing and fitness

FT Globetrotter has launched a new series, helping readers to explore great cities by bicycle. Columnist Simon Kuper shares his tips for getting around the French capital, while Asia tech reporter Mercedes Ruehl reveals four of Singapore’s most scenic cycle routes.

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