Itai Grinberg and Rebecca Kysar, the tax officials who led the global negotiations for the United States, argued in an essay last week that “jobs and investments can thrive in the United States” at a rate of 21 percent.
After a virtual meeting with her counterparts in the Group of 7 Nations last week, Treasury Secretary Janet L. Yellen said the higher interest rate would “generate funding for a sustained increase in critical investments in education, research and clean energy.”
Further details on these plans are expected to be announced in early and mid-October. However, it is not clear how and when the United States would implement this part of the agreement, known as Pillar 1, and there are ongoing concerns among corporate groups and Republicans that American companies would bear the brunt of the new taxes.
The October deadline is self-imposed and could be postponed. Countries have set a goal of fully activating the agreement by 2023 as it will take some time for countries to change their tax laws.
The House of Representatives proposal presented by the Democrats in the Committee on Paths and Appropriations could see significant changes before a final vote. Ultimately, it has to be merged with a proposal from Senate Democrats, who have yet to agree on a tax rate on foreign corporate profits.
Manal Corwin, a finance officer in the Obama administration who now leads national tax practice in Washington at KPMG, said it was possible the rate could go a few inches higher despite corporate opposition.
“You never know how these things will play out when they need more income,” Ms. Corwin said.
Any changes could come with adjustments to the House Democratic proposal for domestic corporate tax rates. Despite Mr Biden’s request for 28 percent, the House of Representatives has proposed a tiered structure ranging from 18 percent for the smallest businesses with incomes less than $ 400,000 to 26.5 percent for businesses with taxable incomes over $ 5 million. Dollar is enough.