U.S Proposes 15% Against 21% Global Minimum Corporate Tax Rate

U.S Treasury Department has proposed a 15% global minimum corporate tax, reversing its earlier call for a 21% minimum rate.

Gatekeepers News reports that the Treasury Department made the 15% global minimum corporate tax rate proposal during Organization for Economic Cooperation and Development (OECD) tax steering group meeting on Thursday.

“It is imperative to work multilaterally to end the pressures of corporate tax competition and corporate tax base erosion,” the Treasury Department said in a statement.

“Treasury underscored that 15% is a floor and that discussions should continue to be ambitious and push that rate higher.”

Janet Yellen, U.S. Treasury Secretary, had in April proposed a 21% global corporate minimum tax as part of President Joe Biden’s infrastructure spending proposal.

Gatekeepers News reports that Some countries, notably France and Germany, supported the U.S. proposal for a minimum rate as high as 21%, but other countries perceived it as too high.

OECD minimum tax discussions had previously centred around 12.5% – the same rate charged by Ireland.

The Biden administration is attempting to influence other countries in the OECD talks to agree to a rate closer to what the U.S. might have, so there’s less of a mismatch.

The Treasury Department has prioritized a global minimum tax both in its proposals for overhauling the U.S. international tax rules and in the OECD negotiations.