21/04/2025

BIZ & FINANCE MONDAY | APR 21, 2025

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Global plans to tax super rich and tech giants stall

DHL to suspend global shipments of over US$800 to Americans BEIJING: DHL Express, a division of Germany’s Deutsche Post, said it would suspend global business-to-consumer shipments worth over US$800 (RM3,527) to individuals in the United States from April 21, as US customs regulatory changes have lengthened clearance. The notice on the company website was not dated, but its metadata showed it was compiled on Saturday. DHL blamed the halt on new US customs rules which require formal entry processing on all shipments worth over US$800. The minimum had been US$2,500 until a change on April 5. DHL said business-to-business shipments would not be suspended but could face delays. Shipments under US$800 to either businesses or consumers were not affected by the changes. The move is a temporary measure, the company said in its statement. DHL said last week in response to Reuters questions that it would continue to process shipments from Hong Kong to the United States “in accordance with the applicable customs rules and regulations” and would “work with our customers to help them understand and adapt to the changes that are planned for May 2”. – Reuters S. Korea officials to hold trade talks in Washington this week SEOUL: South Korea and the United States will hold trade consultations this week in Washington at the suggestion of the United States, Seoul’s Trade Ministry said yesterday. Finance Minister Choi Sang-mok and Trade Minister Ahn Duk-geun will meet with Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent on the sidelines of the spring meetings of the International Monetary Fund and World Bank, the ministry said in a statement. South Korea hopes to lower the 25% “reciprocal” tariff that President Donald Trump has announced for the country, which he has since paused along with high tariffs slapped on a string of countries. Ahn will leave on Wednesday, the statement said. It did not specify the agenda or give other details. – Reuters BERLIN: Volkswagen could relocate some production of its high-end Audi line to dodge American tariffs on automobiles ordered by President Donald Trump, the German carmaker’s CEO said in an interview released last week. Europe’s largest auto manufacturer, which is especially vulnerable to the increase in US tariffs, was in “constructive discussions” with the Trump administration on the issue, Oliver Blume told the

Efforts to tax the world’s ultra-wealthy are also stalling. Brazil used its time as chair of the G20 to push for a plan to impose a 2% minimum tax on the net worth of individuals with more than US$1 billion in assets, a project estimated to raise as much as US$250 billion per year. The Biden administration baulked at the plan and it is unlikely to get any traction with Trump – a billionaire himself and proponent of tax cuts – at the White House. Almost a third of the world’s billionaires are from the United States – more than China, India and Germany combined, according to Forbes magazine. At a recent conference in Paris, French economist Thomas Piketty said the world cannot wait for the G20 to all agree. “We need individual countries to act as soon as they can,” he said. “History suggests that once you have a couple of countries who adopt a certain kind of reform, in particular powerful countries, it becomes sort of a new standard.” – AFP

agreement negotiated under the auspices of the Organisation for Economic Co-operation and Development. The OECD agreement has two “pillars”. The first provides for the taxation of companies in countries where they make their profits, a move aimed at limiting tax evasion. It primarily targets tech giants. Pillar two, which sets a minimum global rate of 15%, has been adopted by around 60 economies, including Brazil, Britain, Canada, the EU, Switzerland and Japan. Daniel Bunn, head of the Tax Foundation, a US non-profit think-tank, said negotiations on implementation of the first pillar “have been stalled for some time”, even under Joe Biden’s presidency. Franco-American economist Gabriel Zucman told AFP that the EU’s reaction in the coming weeks “will be crucial”. “If the EU and other countries give up and allow American multinationals to exempt themselves, it will unfortunately spell the end of this very important agreement.”

o Trump pulls US out of international deal, threatens tariffs over digital levies

PARIS: Global tax plans targeting billionaires and multinational companies are running aground, with the United States torpedoing reforms under President Donald Trump. The billionaire real estate tycoon has pulled the United States out of an international deal on taxing multinationals and threatened tariffs on countries that target US tech giants. Countries have accused Amazon, Microsoft, Google owner Alphabet and Facebook’s parent company Meta of sidestepping local taxes. Trump issued a warning on Feb 21 to countries that would hit big tech and other US companies with fines or taxes that are “discriminatory, disproportionate” or designed to transfer funds to local companies. “My administration will act, imposing tariffs and taking such other responsive actions necessary to mitigate the harm to the United States,” he said in the memo. The move reopens a rift between

Washington and its allies over taxing digital services. During his first term, Trump threatened to slap tariffs on US imports of champagne and French cheese after France rolled out a digital services tax in 2019. Seven other countries have followed France’s lead since then. The tax generated €780 million (RM3.9 billion) for the French government last year. Now the European Union is threatening to impose a tax on digital services if negotiations fail over Trump’s plans to impose 20 percent tariffs on EU goods. Britain, which is hoping to strike a trade deal with the United States, may reconsider its own digital levy, which currently brings in £800 million annually. British Trade Secretary Jonathan Reynolds has said the digital tax is not “something that can never change or we can never have a conversation about”. Nearly 140 countries struck a deal in 2021 to tax multinational companies, an

A demonstrator wearing a shirt that reads ‘Eat the Rich’ is arrested during a protest during the nationwide ‘Hands Off!’ protest against Trump’s policies and executive actions in Washington. – AFPPIC

Volkswagen floats making Audis in America

Despite the presence of a Volkswagen production plant in Tennessee, 65% of its flagship VW brand’s American sales come from vehicles shipped into the United States from Europe or Mexico. The figure rises to 100% for its high-end Audi and Porsche brands. Blume would not comment on the tariffs’ financial impact on Volkswagen, nor on whether it would raise its prices in the United States in response. – AFP

companies relocate part of their production to the United States. Volkswagen – a 10-brand group which also includes Audi, Porsche, Seat and Skoda – sold just over one million vehicles in North America last year, 12% of its sales by volume. With Volkswagen sales in reverse in China in the face of stiff competition from domestic carmakers, particularly on electric vehicles, the US market has become even more important for the German manufacturer.

American manufacturing for Porsche, despite the US market being the luxury sports car brand’s largest. At only around 70,000 vehicles a year the volumes were too small to consider the idea, he said. Trump last month announced a 25% tariff on autos imported to the United States, which is the number one destination for German car exports. The Republican has claimed that imposing tariffs would make foreign

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newspaper. Volkswagen, which earlier in April said Trump’s slew of planned tariffs had dragged down its first-quarter operating profit, wanted to do “as much as possible to remain an investor and reliable partner for the United States”, Blume added. “For Audi, production in the United States would be in line with our development strategy,” he said. However he ruled out any