Treasury Secretary of United StateAnd Janet YellenHe said on Sunday to trust Congress to adopt a file tax A global minimum of 15% for multinational companies welcomed again the “historic” agreement reached on Friday between 136 countries under the framework of the Organization for Economic Co-operation and Development.
“I hope (…this text) will be adopted and we will assure the world that the United States will do its part,” Yellen told ABC.
Each country’s parliaments now have to ratify the global agreement and adapt it to their own legislation.
The 136 signatories, which account for 90% of global GDP, are expected to generate about $173.5 billion in additional revenue thanks to this minimum tax, which should be implemented globally from 2023.
However, there are still some unanswered questions, starting with the ability of the Joe Biden administration to get the reform approved by the Senate and the House of Representatives.
“I am convinced that what we need to do to comply with minimum taxes will be included in the reconciliation process,” said Janet Yellen, referring to a parliamentary style that allows budget legislation to be passed by simple majority.
Democrats want to use it to adopt Biden’s massive social reform, initially set at $3.5 trillion, which includes tax increases for the biggest companies and the wealthiest Americans.
The “reconciliation” measure would allow Democrats, who have a narrow legislative majority, to dispense with Republican opposition votes.
But the majority in the Senate is so short that the ruling party cannot afford the luxury of strongly emerging internal divisions.
Two Democratic senators consider the amount of this expenditure too high, designed to deeply reform the American social fabric and fight climate change.
The additional income generated by the tax on multinational corporations should allow this plan to be partially funded.
The Biden government has other fiscal changes in the pipeline.
The tax rate for high-income households will rise from 37% to 39.6% and companies with more than $5 million in annual profits will rise from 21% to 26.5%.
The latter was reduced from 35% to 21% during Republican President Donald Trump’s major tax reform.