The United States will promote a global agreement on a corporate income tax at the G20, Treasury Secretary Janet Yellen said on Monday, a week after the Joe Biden government presented an infrastructure plan financed by a tax hike. for corporations.
“Together we can use this global minimum tax to ensure that the economy thrives on the basis of a more level playing field for multinational companies, and that innovation, growth and prosperity are fueled,” Yellen said in a speech. at the Council on Global Affairs think tank in Chicago.
Just days after the Joe Biden administration announced on March 31 that it wants to raise corporate income tax to fund a gigantic infrastructure plan aimed at creating jobs, Yellen advocated an international effort to end a “career “to bring this tax to a” minimum “in order to gain competitiveness.
“The proposal announced by President Biden last week calls for ambitious action, including raising the minimum tax rate (for companies) in the United States and a renewed commitment at the international level, recognizing that it is important to work with other countries to end the pressure of tax competition and the erosion of corporate income tax, “Yellen said.
Part of Biden’s plan is to raise corporate income tax from 21% today to 28%.
Yellen has already indicated that she wants to press for an international tax deal within the framework of the Organization for Economic Cooperation and Development (OECD), with a view to establishing a series of standards that include technology companies.
For the Secretary of the Treasury, it is necessary to ensure that governments have fair tax systems that raise enough revenue to invest in essential public goods and can respond to crises.
He also defended that all citizens share the “burden” of financing the government.
– An agreement for July –
According to a senior Treasury official on condition of anonymity, the G20 expects to have a proposal on this issue by July. The source indicated that the US government would need to change laws to carry out this tax reform.
Yellen spoke on the eve of the biannual meetings of the International Monetary Fund and the World Bank and the meeting of the G20 finance ministers, which due to the pandemic were reduced to virtual forums.
The Secretary of the Treasury also stressed that the Biden government seeks to break with the policy of its predecessor, Donald Trump, and wants to return fully to multilateral cooperation.
“In the last four years, we have seen first-hand what happens when the United States withdraws from the global scene. The United States’ first ‘never meant the United States’ alone,” the official said.
With regard to China – which is the second largest global power and has a relationship full of friction with Washington – Yellen reiterated that there will be competition where there needs to be, collaboration where possible and rivalry where necessary.