US Treasury Secretary Steven Mnuchin, left, met with French Finance Minister Bruno Le Maire in Paris on Wednesday (ERIC PIERMONT)

Paris (AFP) – US Treasury Secretary Steven Mnuchin said Wednesday that the US supported a push by France for a minimum corporate tax rate for developed countries worldwide, a move aimed at curbing tax avoidance by multinationals.

“It’s something we absolutely support, that there’s not a chase to the bottom on taxation,” Mnuchin said in Paris after talks with Finance Minister Bruno Le Maire.

Le Maire said last month a minimum tax rate would be a priority for France during its presidency of the G7 nations this year.

Pressure is growing on governments to crack down on so-called “fiscal optimisation” moves that let large companies declare revenues in low-tax nations, even if the bulk of their business is done elsewhere.

France in particular has railed against Amazon, Google and other technology giants that declare their European income in low-tax countries like Ireland or Luxembourg.

“A mechanism for a global minimum tax at the G7 level is the best way for moving forward on this subject,” Le Maire said Wednesday.

But while Mnuchin said the US would support a multilateral push to tax digital giants, he said he did not agree with France’s plan to impose its own digital tax as soon as this year, after failing to secure a European-wide accord.

France said it needed to move quickly, while the Organisation for Economic Cooperation and Development (OECD), which groups open-market democracies, tries to forge a global solution.

“I’m sympathetic to the issue that needs to be addressed, but I think broader than just digital, it could also include a wider base of companies where the issue of where they’re located becomes more complicated,” he said.

“We are not in favour of the current digital tax that has been proposed, but we are very looking forward to the position of France that if there is a global solution at the OECD that will replace it,” Mnuchin said.

– ‘Good candidate’ –

Le Maire also gave France’s backing to Washington’s pick to become head of the World Bank, saying that “we consider David Malpass to be a good candidate.”

Malpass has been a fierce critic of the bank, which fuelled speculation that the agency’s European shareholders might balk at President Donald Trump’s pick — even though the post has traditionally gone to an American.

“I reminded him of the importance the French president and government place on two major roles for the bank: support for the poorest countries, and for the fight against climate change,” Le Maire said.

Malpass, who participated in the talks with Le Maire in Paris, noted that the World Bank has been extending loans to developing countries to help them mitigate the risks of climate change, “and I expect it is going to be able to continue to do so.”

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