Democrats’ Budget Set To Include Global Minimum Tax, Treasury Secretary Says
Treasury Secretary Janet Yellen said Sunday that she is confident that the Democrats’ budget will include a global minimum tax for corporations just days after nearly 140 countries endorsed the measure.
“I am confident that what we need to do to come into compliance with the minimum tax will be included in a reconciliation package,” Treasury Secretary Janet Yellen told ABC News on Sunday. “I hope that it will be passed and we will be able to reassure the world that the United States will do its part.”
Though the United States and 135 other countries signed the agreement, each nation must pass its own legislation to enact the minimum tax rates. Democrats are currently crafting the budget, a spending package that would reshape the social safety net, but the process has slowed by disagreements between the party’s moderate and left wings.
Discussions regarding the global minimum corporate tax began earlier in 2021 and were led by the Organization for Economic Cooperation and Development (OECD). The agreement requires at least a 15% corporate tax on multinational companies with revenue greater than 750 million euros annually, which the OECD projected may generate up to $150 billion in tax revenue per year.
Another report found that corporations shift $1.38 trillion in profits into global tax havens per year, causing countries where the profit was generated to lose $245 billion in annual tax revenue.
Yellen said the deal could reverse the “global race to the bottom” regarding corporate tax rates and instead give countries the “resources we need to invest in our people and our economies.”
“[It] is really something we need to make globalization work and to make it work for American workers,” she added.
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