“Donald Trump has ordered officials to develop measures against countries that apply “extraterritorial” taxes on US multinational corporations, raising the risk of a global conflict over tax regimes.”, — write: epravda.com.ua
Donald Trump has ordered officials to develop measures against countries that apply “extraterritorial” taxes on US multinational corporations, raising the risk of a global conflict over tax regimes. This was reported by the Financial Times newspaper. The US president issued this order on Monday night in the form of an executive order, announcing the US withdrawal from the global tax agreement, which was agreed last year within the framework of the OECD. The agreement allowed other countries to levy additional taxes on American multinational corporations. Advertisement: He also added that a “list of options for safeguards” should be prepared “within 60 days,” a warning to OECD signatories to the deal — including the EU, Britain, South Korea, Japan and Canada – about Washington’s intention to carry out radical challenges to global tax rules. Trump’s order also mentions an investigation into “whether the tax rules of foreign countries comply with tax treaties with the United States, whether they contain rules that are extraterritorial in nature or disproportionately affect American companies.” Ellie Rennison, a former UK Trade Department official, said the move demonstrates Trump’s expansion of “economic warfare” far beyond tariffs in response to what the US considers discriminatory practices by other countries.Advertisement: Grant Wardell-Johnson, head of global tax policy at the company KPMG said the U.S. response could include additional taxes on foreign companies operating in the U.S. or withholding taxes on payments to such jurisdictions. In a two-part memo to the US Treasury secretary, Trump initially ordered the cancellation of commitments the Joe Biden administration had made under the OECD agreement, a move that had been widely expected. But then he expanded the scope of the attack. The potential scope of action includes not only whether the OECD agreement violates tax treaties, but also the extraterritorial potential of all tax rules in all countries. We will remind: US President Donald Trump on Monday said that the global agreement on the minimum corporate tax “has no force or effect” in the US, effectively withdrawing the country from the historic 2021 agreement concluded by the Biden administration with almost 140 countries.