U.S. Treasury Secretary Janet Yellen on Monday called for international cooperation for a global minimum corporate tax rate, according to the WSJ.
- Yellen said competitiveness is about more than how U.S.-headquartered companies fare against others firms, but rather about making sure that governments have stable tax systems that raise sufficient revenue.
- If the U.S. raises its tax rates, a global minimum tax would help prevent overseas companies from having a significant advantage over U.S. companies’ foreign operations. Without it, American firms will have a potential disadvantage.
- Yellen’s speech comes as finance ministers are scheduled to gather virtually for the International Monetary Fund and World Bank meetings later this week.
- President Joe Biden is pushing to raise the corporate tax rate to 28% from 21%, bringing the U.S. near the top among major economies. He also plans to impose a 21% minimum tax on American companies’ foreign income, remove export incentives, and raise tax on foreign companies’ U.S. operations.