Washington D.C. – Today, Congresswoman Carol Miller (R-WV) slams the Biden Administration for allowing the Organization of Economic Co-operation and Development to surrender the American tax code to foreign countries.
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Congresswoman Miller began by highlighting the failed negotiations stemming from the Biden Administration.
“I have been acutely concerned with the actions taken at the OECD and the Biden Administration’s failure to protect American interests over the course of the past several years. I traveled to the OECD with Chairman Smith and my colleagues last summer to tell these unelected, globalist bureaucrats that they are going down the wrong path and the U.S. tax base IS NOT a piggy bank for Europe’s socialist policies. These failed negotiations have left the United States in a much worse place than when President Trump started this process to protect our interests from the rising threat of Digital Service Taxes. Biden’s Treasury negotiators were either asleep at the wheel or actively undermining U.S. companies, which will result in our tax dollars and jobs being sent overseas. Either way, this result is unacceptable.”
Congresswoman Miller continued by encouraging the Biden Administration to put U.S. interests first.
“In the coming months, Treasury must do everything in its power to mitigate the damage that they’ve caused at the OECD. The whole point of these negotiations was to protect US companies from Digital Service Taxes, but France, Canada, and other countries have already moved forward, and the OECD process is unlikely to solve this issue. As President Trump wrote in the Art of the Deal, "The worst thing you can possibly do in a deal is seem desperate to make it. That makes the other guy smell blood, and then you're dead." I urge President Biden to heed the advice of his predecessor & successor.”
Congresswoman Miller asked Daniel Bunn, President and CEO, Tax Foundation, on why the U.S. is negotiating our tax code with a foreign organization.
“Mr. Bunn, can you go into further detail on why the U.S. is negotiating at the OECD on Pillar 1 and Pillar 2 in the first place?”
"After the passage of the Tax Cuts and Jobs Act, other countries looked at our policies and said, ‘Well, maybe there can be a global agreement based off of this newly designed U.S. tax tool. We could call that a global minimum tax.’ My interpretation of the letter is that if there was going to be a multilateral agreement on allocating taxing rights, the design of that should be attractive enough with certainty and stability and things of that, that companies may want to opt into that. The position of the Trump administration was to look at what was being negotiated on the global minimum tax and say [to] other countries, ‘you're welcome to do that’ as long as it doesn't implicate us law and require U.S. law change.
Where we are today is on the global minimum tax side, the agreement has already eroded part of the U.S. tax base so that’s the journey we've been on over the last several years with these negotiations. And it's not clear that there's an opportunity to move back to that previous negotiating position," responded Mr. Bunn.
Congresswoman Miller concluded by asking Rick Minor, Senior Vice President, International Tax Counsel, United States Council for International Business how these negotiations would make things better for Americans.
“Can you explain how the current definition of Digital Services Taxes (DST) in Pillar 1 fail to meet the moment? How could these definitions be improved in further negotiations to protect U.S. interests?”
“Under the current language, there is some there is some flexibility that an aggressive jurisdiction can simply see how the DST is defined and then draft its version of what I would then call DST, that does not fall within the forbidden elements of the, the DSP prohibited under the current draft of the (Municipal Lien Certificate) MLC. We’ve called for the there must be a more airtight version of the definition of DST to keep jurisdictions prevent jurisdictions from being tempted to plan around what definition is in the MLC now.”
“Would Pillar 1 be any easier to comply with in its current form, or would it make matters worse?” asked Congresswoman Miller.
“Well, it's still it's still being amended. And so, it's difficult to come to that conclusion or until we've seen the final the final text of the MLC,” responded Mr. Minor. |