The United States and France lobby for a minimum global corporate tax rate

In February 2019, the U.S. Treasury Secretary Steven Mnuchin stated that the United States supports the proposal of France to impose a worldwide minimum corporate tax rate for developed countries. More specifically, Mr Mnuchin stated, “It's something we absolutely support, that there's not a chase to the bottom on taxation”. The proposal will be a priority of France during its presidency of the G7.If the French proposal becomes a reality at a global level, many zero-tax jurisdictions will be forced to increase their tax rates. Such a drastic change will force companies established in zero-tax jurisdictions to adapt to the changing regulatory environment. For example, they may need to hire accountants and submit regular tax declarations.To avoid legal uncertainty in the future, companies willing to optimise their taxes may relocate to mid-shore jurisdictions, i.e., jurisdictions that have relatively low tax rates and adhere to international tax transparency standards. The use of mid-shore jurisdictions is in line with the tax initiatives of the Organisation for Economic Co-operation and Development (OECD) and other international organisations that recognise the state sovereignty in respect to the adoption of low tax rates as long as those low tax rates are included in a balanced fiscal framework that benefits the economy of the respective country as a whole. Mid-shore jurisdictions also usually have good administrative, technological, and transport infrastructures, thus allowing companies established there to benefit not only from low-tax rates without being associated with tax havens, but also to establish real economic activities in an attractive business environment.Bulgaria is one of the mid-shore countries that attract more and more companies willing to legitimately optimise their taxes. The small country is a member of the European Union which, in turn, provides companies established there with direct access to the entire EU internal market. Furthermore, the geopolitical stability of Bulgaria is ensured by its NATO membership. Companies established in Bulgaria pay one of the lowest tax rates in the EU (the rate of the individual and corporate tax is 10%) and have access to the affordable workforce of the country.