U.S. Treasury Secretary Janet Yellen will press G20 counterparts this week for a global minimum corporate tax rate above the 15 percent floor agreed by 130 countries last week, but a rate decision is not expected until future phases of negotiations, U.S. Treasury officials said on Tuesday, Reuters reports.
The specific rate, and potential exemptions, are among issues still to be determined after 130 countries reached an historic agreement at a Paris-based Organisation for Economic Co-operation and Development (OECD) meeting last week.
The countries outlined a global minimum tax and the reallocation of taxing rights for large, highly profitable multinational firms.
The deal is widely expected to be endorsed by G20 finance leaders when they meet on Friday and Saturday in Venice, Italy.
Negotiations on the global minimum tax rate, aimed for completion by the G20 leaders’ summit in October, is tied to the outcome of legislation to raise the U.S. minimum tax rate, a Treasury official said.
The Biden administration has proposed doubling the U.S. minimum tax on corporations overseas intangible income to 21 percent along with a new companion “enforcement” tax that would deny deductions to companies for tax payments to countries that fail to adopt the new global minimum rate.
The officials said several countries were pushing for a rate above 15 percent, along with the United States. Yellen has been working with the tax-writing committees in Congress to include such provisions in budget “reconciliation” legislation, to align U.S. tax laws with the new international tax goals.