Over the weekend, finance ministers from G7 economies agreed to new global tax policies that could potentially have a major impact on big tech stocks.

What Happened: G7 members Canada, France, Germany, Italy, Japan, the United Kingdom and the United States pledged to enforce a minimum global corporate tax rate of at least 15%.

In addition, they committed to ensuring taxes are paid in the countries in which revenues are generated, potentially eliminating the transfer of profits to tax shelters like Ireland.

Why It’s Important: Bank of America analyst Justin Post said the new framework could potentially eliminate digital services taxes in the Eurozone, such as the 3% tax in France.

For reference, Post said he estimates 2021 GAAP tax rates of 19% for Amazon.com, Inc. (NASDAQ:AMZN), 18% for Facebook, Inc. (NASDAQ:FB), 16% for Alphabet, Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) and 16% for Netflix, Inc. (NASDAQ:NFLX).

Post said the FANG group generates about half its revenues and profits outside of the U.S. Current international tax rates are in the 10% to 14% range, while the U.S. corporate tax rate stands at 21%. He said the new G7 deal could raise the average international tax rate on the FANG stocks by about 2%, which would translate to an average 2.4% negative impact on GAAP EPS.

Related Link: Wedbush Adds Alphabet Stock To Best Ideas List: What You Need To Know

Post said new tax policies could take a bite out of FANG earnings, but it could also eliminate some of the regulatory uncertainty that has been weighing on big tech valuations.

“We think there is a reasonable probability of average tax rates for FANGs increasing by 4 points from new US (assuming US corporate rates move to 25%) and International tax legislation,which would result in 5% lower average EPS, but changes will likely take a few years and we would anticipate some new tax optimization strategies that could offset some of the impact,” he wrote in a note.