Finance leaders from the G7 group of advanced economies said Saturday that they had reached an agreement on establishing a minimum global corporate tax rate, a significant step forward in the Biden administration’s effort to reduce tax avoidance by major corporations.

Under the agreement announced by the G7 nations – Canada, France, Germany, Italy, Japan, the United Kingdom and the United States – multinationals would have to pay a tax of at least 15% in each country in which they operate, less than the Biden administration’s earlier proposal of 21% but still within the range of what the White House said it would accept.

Treasury Secretary Janet Yellen reportedly played a major role in the effort to reach a consensus on an issue that has been under discussion for a decade or more. “That global minimum tax would end the race to the bottom in corporate taxation, and ensure fairness for the middle class and working people in the U.S. and around the world,” she said in a statement. “The global minimum tax would also help the global economy thrive, by leveling the playing field for businesses and encouraging countries to compete on positive bases, such as educating and training our work forces and investing in research and development and infrastructure.”

A key issue in the talks has been the taxation of technology giants like Google and Facebook, which have deployed sophisticated strategies to reduce their taxes. The U.S. has pressed G7 nations to eliminate their taxes on digital services, arguing that they unfairly target American firms, but those taxes will remain in place for now, until a final agreement can be negotiated.

“Just because their business is online doesn’t mean they should not pay taxes in the countries where they operate and from which their profit derives,” treasury officials from France, Germany, Italy and Spain said in a joint statement. “Physical presence has been the historical basis of our taxation system. This basis has to evolve with our economies gradually shifting online.”

Billions at stake: Even without all the details being spelled out, it’s safe to say that a global minimum tax, if implemented successfully, would generate significant revenues. A group that analyses European tax systems estimates that a 15% tax would generate nearly $60 billion a year, while the Biden administration projects revenues of $500 billion over a decade for the U.S. from a minimum tax.

Still a long way to go: The agreement is a statement of principle and the details still need to be worked out, in a process that could take years. Any eventual agreement would have jump through numerous hurdles for approval, including but not limited to the broader group of G20 nations – which includes Ireland, a major beneficiary of the current status quo that has announced its opposition to the idea of global minimum tax – and the U.S. Congress, where resistance from Republicans and business lobbyists could be fierce.

Rep. Kevin Brady (TX), the top Republican on the House Ways and Means committee, and Sen. Mike Crapo (ID), the top Republican on the Senate Finance Committee, issued a joint statement criticizing the “speculative agreement,” charging that it “could adversely affect U.S. businesses, and ultimately harm American workers and jobs.”

Still, numerous economic experts said the agreement was a major milestone. “This is truly a BFD,” tweeted Steven Rattner, the journalist-turned-banker who served as the auto czar in the Obama administration. “Multinational corps have been gaming the system for decades at the expense of Treasury and American people. Hats off to @SecYellen.”

Wall Street, however, isn’t so sure. Bloomberg Opinion columnist David Fickling wrote Monday that as far as major corporations are concerned, “we’ve yet to see anything that suggests the gravitational pull of ever-lower corporate taxes is about to be reversed.” Reaching an agreement will take a long time, and any final agreement will no doubt be immensely complex – providing plenty of opportunities for loopholes and new tax minimization strategies.

“A successful deal on multinationals’ tax minimization would represent a major blow for the world’s biggest companies,” Fickling said. “In the wake of this weekend’s agreement, their silence speaks volumes.”

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