American Giants Get a Tax Break in Global Deal

A recent agreement by nearly 150 countries, led by the Organization for Economic Cooperation and Development (OECD), aims to prevent large global companies from avoiding taxes by moving profits to low-tax countries. However, there's a twist: U. S. -based multinational corporations are exempt from this new 15% global minimum tax. This exemption came about after negotiations between the Trump administration and other Group of Seven nations. The deal is seen as a way to protect U. S. sovereignty and businesses from what some call "extraterritorial overreach. " But not everyone is happy with this change. Critics argue that this exemption undermines years of progress in corporate taxation. They say it allows the largest and most profitable American companies to continue parking profits in tax havens like Bermuda and the Cayman Islands. These places are known for having very low or no taxes, even though the companies do little or no business there.The original plan, pushed by former Treasury Secretary Janet Yellen, was to stop this practice. But congressional Republicans saw it as a threat to U. S. competitiveness. They rolled back a provision that would have allowed the U. S. to tax companies with foreign owners and investors from countries with "unfair foreign taxes. " Tax transparency groups are not pleased. They say this deal risks undoing nearly a decade of global progress. They argue that the minimum tax was supposed to stop countries from competing to have the lowest corporate tax rates, a race that benefits multinational businesses. On the other hand, congressional Republicans are happy with the finalized deal. They see it as another step in putting America first and unwinding what they call the Biden administration's "unilateral global tax surrender. "