Here at home, Joe Biden’s White House has pressured federal lawmakers to impose trillions of dollars in higher taxes and wasteful, “woke” spending that will further compound the growing inflation problem. .
Internationally, the Biden agenda also calls for higher taxes for Americans. The Biden administration has worked with foreign governments to establish a overall minimum tax rate on American companies.
Why agree with our competitors to keep US corporate taxes high? It does nothing to help American taxpayers, workers or small businesses. This huge concession paves the way for a global tax regime that rigs the system in favor of a bigger government.
The proposed changes to the international tax rules contain two parts or “pillars”. The first pillar would allow other nations to tax American businesses in ways that current rules prohibit. The United States would be one of the biggest losers from the effects of the first pillar, as it would give foreign governments the power to further raise taxes on American businesses.
The second pillar would require each country to maintain its business taxes at 15% or more. A cartel of tax collectors like OPEC was for oil prices. One can imagine how the opening offer of 15% will increase from year to year.
treasury secretary Janet YellenJanet Louise YellenHouse Democrats call on Biden to unfreeze Afghan central bank reserves On The Money — Presented by Citi — Rebuilding Better…Late Than Never? Biden signs debt ceiling increase, avoiding default MORE said this agreement will prevent nations from competing by keeping taxes low. The United States will have to compete with China and Bangladesh by cutting wages. Limited wages rather than limited government cost.
This is just another tax grab by left-wing big government politicians. foreign governments. Authorized by Biden.
This deal would relinquish US fiscal sovereignty to foreign bureaucrats. There’s every reason to believe that foreign countries — especially geopolitical rivals like Russia and China — won’t play by the rules. Many of these countries have non-transparent economies and state-owned enterprises and could easily pretend to apply a minimum tax of 15% while avoiding real participation.
When our European competitors started promoting the global minimum tax agreement, the Chinese media urged the Chinese Communist Party to respond by reducing taxes in order to attract more investment and strengthen the domestic manufacturing industry.
Foreign countries routinely fight America for trade access and barriers and take action to protect domestic farmers and manufacturers. There is no reason to think that the same dynamic would not occur with respect to the global minimum tax and that countries would not take measures that protect or provide a benefit to their workers and businesses.
Other world leaders will likely refuse to follow President BidenJoe Biden’s nominee Biden says fighting inflation is top job Harris says she won’t ‘absolve’ senators for voting rights pushes Obama to back Biden to change the filibuster PLUS to block high tax rates in their countries given the uncertainty surrounding the global economy.
There are many benefits this deal would bring to big government statists, but little or nothing that will help American workers and businesses.
U.S. lawmakers can stop this deal because the Biden administration cannot single-handedly sign the U.S. into compliance with the deal.
The Democrats’ socialist tax and spending bill must pass for the United States to have a 15% minimum tax. Not only will businesses see higher taxes, but the proposal would also force businesses to calculate this new tax on a country-by-country basis, rather than globally. This change would create significant tax complexity and uncertainty for businesses operating overseas.
However, this agreement has the opposition of all Republicans in Congress and the senator.Joe ManchinJoe ManchinHarris says she won’t ‘absolve’ senators for voting rights, pushes Obama to back Biden to change filibuster House to vote on consolidated election bill Thursday, says Pelosi MORE (DW.Va.) has hitherto been reluctant to support the legislation.
Additionally, the deal requires amending the dozens of existing bilateral tax treaties that have been ratified by Congress, which requires 67 votes in the Senate. That means Republican lawmakers have the ability to block key parts of this deal.
Therefore, we have some leeway. There is a real opportunity for pro-growth, low-tax Republicans to emphasize their commitment to tax competition rather than tax “harmonization.”
This will allow a clear contrast between the two political parties. On the one hand, Republicans will support lower taxes that help working families and small businesses. On the other, Biden and congressional Democrats are pushing billions of dollars in US tax hikes and want to block high overseas taxes on American workers through the so-called Global Tax Deal. minimum tax.
Grover Norquist is the president of Americans for Tax Reform.