US pressures European Union withdraw Google tax before the G20 meeting that will raise the global tax on multinationals to 15% - At the end of this week, finance ministers from the G20 countries meet in Venice, Italy, to discuss preliminary agreements to implement a global corporate tax reached in June by the G7 and the Organisation for Economic Co-operation and Development (OECD) and supported by the International Monetary Fund (IMF) and 130 countries representing 90% of world GDP.

The Venice meeting will serve for the group of the 20 largest world economies to finalize their agreement to apply a minimum global rate of 15% on corporate tax that avoids tax avoidance techniques of multinationals, especially US technology companies such as Apple, Google or Amazon. This preparation will make it easier for the G20 to succeed in approving this measure at its next meeting of heads of State and Government, scheduled for October, according to the Financial Times.

The approval of the global minimum rate is practically achieved, because it has the endorsement of the President of the United States, Joe Biden, who proposed in April to raise the corporate tax to companies operating outside his country and that the OECD implement a global minimum tax to prevent multinationals from resorting to tax havens or encouraging tax dumping between countries.

Biden's proposal, which received the support of institutions such as the IMF, the governments of France, Spain or Austria or even companies that would be directly affected by the measure, such as Amazon, Google or Facebook, involves rescuing an initiative agreed by the G7 in 2019 after several years of study to reform corporate tax and ensure that multinationals pay taxes in the jurisdictions where they generate income.

US pressures European Union withdraw Google tax

However, despite Biden's support for the creation of a global minimum type of companies, the agreement in the G20 could not materialize due to the objections that the US is raising to the so-called European Google tax, with which Brussels will apply taxes to the digital services provided by large technology companies in its territory and with which it plans to collect about 1,300 million euros.

In particular, the US is pressuring the European Union to withdraw its Google tax proposal, considering that this measure collides with the approval of a global minimum corporate tax rate, according to the Financial Times, which ensures that the EU tax on digital services could imply a double taxation of multinationals, which could hinder its implementation.

US pressures European Union withdraw Google tax

The US and EU representatives will meet this Friday before the G20 summit in Venice and the US Treasury secretary, Janet Yellen, will participate next week in a meeting with her Eurogroup counterparts to discuss the OECD and G7 proposal on corporate tax, although it is expected that the debate on the EU Google tax will also star in both meetings.

In fact, Yellen has already examined both fiscal proposals this Tuesday with the vice-president of Competition and Digital officer of the European Commission, Margrethe Vestager, and, after the meeting, Brussels said that it had been "a first exchange good and constructive", according to the financial daily, which states that the european authorities could seek a commitment to withdraw its rate Google if you agree to an extent similar to global scope within the OECD.

US pressures European Union withdraw Google tax

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Emirates already flies to almost all its pre-coronavirus destinations but still lacks height: what does the recovery depend on and when it will arrive, according to its general director in Spain

The pandemic has affected industries and sectors around the world.

It is an unprecedented reality worldwide, especially for the travel sector, greatly affected by the closure of borders, restrictions on mobility or the state of alarm in Spain.

Despite the difficulties experienced by this industry, some have seen the positive side.

"I believe that good things also come out of everything bad and what the pandemic has taught us is the constant search for solutions to improve the travel experience of all our customers. Because we have to ensure not only a good experience, but also safety at all stages of the journey," said Monika White, Managing director of Emirates for Spain, in an interview.

The board notes that Emirates has a fairly agile and versatile business model that has allowed them to adapt to all the changes in this unprecedented scenario.

"Many months ago, the situation was very different and we had to be evolving to ensure a safe trip and a pleasant experience," he says. "In this sense, we continue to lead the industry with innovative products and services."

One example is the fare conditions, which now offer maximum flexibility in case circumstances change.

In July they became the first airline to offer coverage for COVID-19, which represents an evolution of the company's current multi-risk travel insurance, with one coverage of up to 150,000 euros and contemplating a possible quarantine of 100 euros per day for 14 days. "We have been improving to meet the needs of the current context. In addition, there are some countries that ask for medical insurance before entering and all our passengers can already have it," explains White.

Overall, White says they are optimistic about demand recovery. "We have a pretty solid business model and are making continuous investments in our products, services and overall expertise," he says.

Some of these changes, such as the acceleration of digitization and the biometric processes already applied in Dubai —where they have their hub for international flights—, will be maintained once the pandemic passes because they were changes that they had previously planned.

Another of those advances that COVID-19 has imposed is the IATA Travel Pass, which will be complementary —not exclusive— to the Digital Green Certificate.

"It is very important in the pandemic to give confidence, not only in the safety on the trip, but in all stages. What you do not want is to arrive at the airport and realize that you are missing a test or that the one you took is not valid for that destination. There is going to be a lot to be gained by standardizing all these processes."

Emirates suspended all flights in March 2020, and has since gradually regained its destination network. In May of last year, he resumed his route to Madrid, followed in June by Barcelona. Currently, they operate 5 weekly flights to Dubai from Madrid and 4 from Barcelona.

According to White, "we have been expanding operations responsibly, but always ensuring that operationally and commercially it was a viable decision". That is why, he says, they have "good prospects" since, as travel restrictions to enter a country have been relaxed, the demand has responded.

One of the most popular destinations is Dubai, but they also see an increase in the Maldives and Seychelles, which soon opened their doors to foreign tourism.

Although the business stopped for months, White says that the VFR (visit friends and relatives) segment had a constant demand and what pulled the car was the freight business, which generated constant revenue while its traditional business, passenger transport, was paralyzed.

White explains that the recovery of the air sector depends on a number of factors: government authorities, the flexibility of restrictions, how the vaccination campaign is going around the world and what the health situation is like, not only here in Spain, but worldwide.

For now, they consider that the reactivation of the demand for international travel will be slower and, surely, it will take between 12 and 24 months to recover the pre-pandemic levels.

Meanwhile, the airline focuses on treasury and cost control, as well as operational efficiency and talent, and works to restore its revenue streams.

"We think we are well positioned to respond quickly to a changing situation," says White.

Currently, it flies to 114 destinations and plans to add 10 more by the end of July-such as the route from Dubai to Mexico via Barcelona. That would mean reaching 90% of the network that operated before the coronavirus.

White clarifies, of course, that they will not be the same frequencies or the same offer of seats:"We are going to have the network of before, but not with the entire fleet, we are trying to optimize it".

"Our goal now is to restore the network we had before the pandemic," he says.

The group announced last June its first losses in more than 30 years, caused by the collapse in revenues in the financial year ended March 31, 2021.

Emirates lost 5,076 million euros in its last fiscal year. In the previous year, the profit stood at 390.5 million euros. Revenues in 2020 stood at 8,178 million euros, representing a year-on-year decrease of 66%.

Emirates carried 6.6 million passengers (-88%) in this period and its aircraft seat volume contracted by 83%. In its annual report, it states that the occupancy factor stood at 44.3%, compared with 78.5% in the previous year.