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Yellen: 130 Nations Agree to Global Corporate Minimum Tax
Treasury Secretary Janet Yellen has announced that 130 nations have agreed to proposals by the Organization for Economic Cooperation and Development (OECD) for a global minimum tax on corporations. “[The] agreement by 130 countries representing more than 90 percent of global GDP is a clear sign: the race to the bottom is one step closer to coming to an end,” Yellen said. Nine countries did not sign; this group included the low-tax European Union members Ireland, Estonia, and Hungary as well as Peru, Barbados, Saint Vincent and the Grenadines, Sri Lanka, Nigeria, and Kenya. India, China, and Turkey, which had been holding out during the negotiations, joined in the agreement. The world’s financial leaders will endorse a deal setting a global minimum corporate tax and call for technical work to be finished so they can approve the framework for implementation in October. The plan is for the new rules to be implemented by 2023.
Efforts to Modernize Technology Systems to be Completed Next Year
The Financial Accounting Foundation’ (FAF) project to replace the obsolete technology used to produce and distribute FASB and GASB accounting rules will be completed in the second quarter of 2022, instead of this year as previously announced, according to its August 24 discussions. The FAF, under its Content, Vision, and Enablement (CV&E) initiative, aims to bring the accounting rulemaking boards’ technological systems into the 21st century, thereby saving costs in the long run.
State and Local Governments Not Signaling Need for Accounting Guidance on ARPA
State and local governments have not specified broad concerns about how to report the billions of dollars of federal funding they received from the American Rescue Plan Act (ARPA) of 2021, according to recent remarks by GASB Chair Joel Black. GASB therefore does not plan on issuing a technical bulletin about reporting ARPA funds, as it has for prior stimulus funds, but is open to doing so if necessary, Black said on August 24 at the FAF quarterly trustee meeting. “So far we have determined we don’t need any official guidance similar to the technical bulletin we issued to the CARES Act a year ago,” he said. “Most of the technical inquiries we’re getting on ARPA funds are specific to a unique government or maybe governments within a specific state, but answers wouldn’t necessarily apply across multiple governments.” GASB is “asking people to provide us with input if they need help from an accounting perspective related to the ARPA funds that many governments have now received.”