Biden administration launches fight for minimum taxation of multinationals

The Biden administration has started the fight for minimal taxation of corporate profits, possibly marking the end of forty years of global tax competition. In any case, this is the objective set out on Monday April 5 by Janet Yellen, the Secretary of the Treasury of the United States: “We are working with the G20 countries to agree on a minimum global corporate tax rate that can stop the race to the bottom,” said Mme Yellen in a speech in Chicago, defending fair competition on the planet and taxation that allows states to fulfill their missions.

The intervention of Mme Yellen is to be placed in a double context, national and international. It comes a week after President Joe Biden presented in Pittsburgh a sweeping $ 2.2 trillion investment plan that would be funded largely by rising corporate taxes – Mr. Biden intends to hike the tax rate on corporations (IS) from 21% to 28%, while it was 35% under Barack Obama.

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The working classes at the heart of the political project

It is part of the workers’ program of President Biden, who intends to put the working classes back at the heart of the American political project and intends to have a state financed by all, including businesses. However, these do not. “In 2019, 91 Fortune 500 companies, the largest companies in the world, including Amazon, were using various loopholes to avoid paying a single dime in federal income tax.”, had denounced Mr. Biden in Pittsburgh (Pennsylvania). “I don’t want to punish them, but it’s not right. A firefighter and a teacher pay 22%? Amazon and 90 other big companies pay no federal taxes? I will put an end to this. “

Mme Yellen repeated the political background: “It’s about ensuring that governments have stable tax systems that generate sufficient income to invest in essential public goods and respond to crises, and that all citizens share the burden fairly. “

For this, all countries must play the game, especially since the Republicans are already denouncing in the Biden plan the competitive disadvantage inflicted on American companies. Mme Yellen deliberately made this speech two days before the meeting of the G20 finance minister: so that the United States is not the losers in this movement, she asks her partners to support her: “President Biden’s proposals (…) call (…) to a renewed international engagement, recognizing the importance of working with other countries to end the pressures of tax competition and the erosion of the corporate tax base ”, confirmed Mme Yellen.

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