US Multinationals To Keep Profits, Despite Global Tax Deal
In a significant setback for efforts to crack down on corporate tax avoidance, nearly 150 countries have agreed on a landmark plan to limit the ability of large multinational corporations to shift profits to low-tax jurisdictions. However, the United States has been exempted from this deal, sparking outrage among tax transparency groups.
The agreement, finalized by the Organisation for Economic Cooperation and Development (OECD), would have imposed a 15% global minimum tax on companies with operations in multiple countries. But negotiations between the US government and other G7 nations have resulted in the US being allowed to keep its existing tax arrangements intact.
"This deal risks nearly a decade of global progress on corporate taxation, only to allow the largest, most profitable American companies to continue parking profits in tax havens," said Zorka Milin, policy director at the Fact Coalition, a tax transparency nonprofit. "It's a step backward for international cooperation and a blow to the fight against corporate tax avoidance."
The exemption has been met with criticism from tax watchdogs, who argue that it undermines efforts to halt an international race to the bottom on corporate taxation. Companies like Apple and Nike have long used complex accounting and legal maneuvers to shift profits to low- or no-tax havens.
The decision comes after years of effort by former Treasury Secretary Janet Yellen and other advocates for greater transparency in multinational corporations' tax dealings. In 2021, the OECD agreed on a landmark deal setting a minimum global corporate tax rate of 15%, but it was met with opposition from congressional Republicans who said it would make the US less competitive.
Now, the US has effectively blocked that progress, allowing its largest corporations to continue taking advantage of low-tax jurisdictions. The implications are significant, and critics warn that this exemption could embolden other countries to follow suit.
For now, US companies like Apple and Nike can breathe a sigh of relief, knowing they won't be subject to the new global minimum tax rate. But for advocates of greater transparency and fairness in international taxation, this is a disappointing setback in their ongoing fight against corporate tax avoidance.
In a significant setback for efforts to crack down on corporate tax avoidance, nearly 150 countries have agreed on a landmark plan to limit the ability of large multinational corporations to shift profits to low-tax jurisdictions. However, the United States has been exempted from this deal, sparking outrage among tax transparency groups.
The agreement, finalized by the Organisation for Economic Cooperation and Development (OECD), would have imposed a 15% global minimum tax on companies with operations in multiple countries. But negotiations between the US government and other G7 nations have resulted in the US being allowed to keep its existing tax arrangements intact.
"This deal risks nearly a decade of global progress on corporate taxation, only to allow the largest, most profitable American companies to continue parking profits in tax havens," said Zorka Milin, policy director at the Fact Coalition, a tax transparency nonprofit. "It's a step backward for international cooperation and a blow to the fight against corporate tax avoidance."
The exemption has been met with criticism from tax watchdogs, who argue that it undermines efforts to halt an international race to the bottom on corporate taxation. Companies like Apple and Nike have long used complex accounting and legal maneuvers to shift profits to low- or no-tax havens.
The decision comes after years of effort by former Treasury Secretary Janet Yellen and other advocates for greater transparency in multinational corporations' tax dealings. In 2021, the OECD agreed on a landmark deal setting a minimum global corporate tax rate of 15%, but it was met with opposition from congressional Republicans who said it would make the US less competitive.
Now, the US has effectively blocked that progress, allowing its largest corporations to continue taking advantage of low-tax jurisdictions. The implications are significant, and critics warn that this exemption could embolden other countries to follow suit.
For now, US companies like Apple and Nike can breathe a sigh of relief, knowing they won't be subject to the new global minimum tax rate. But for advocates of greater transparency and fairness in international taxation, this is a disappointing setback in their ongoing fight against corporate tax avoidance.
I feel so frustrated about this news 
! It's like the US is just too powerful and can't be held accountable for its actions 
. I mean, come on, 15% global minimum tax rate was a great step forward for everyone else, but not for America 
. Those big corporations like Apple and Nike are basically getting away with murder 
... I mean, tax avoidance! It's just not fair to the rest of us who have to pay our taxes on time 
.
. But now it seems like some countries are just more equal than others 
. I hope someone does something about this soon, because I'm getting tired of seeing big corporations taking advantage of the system 
.
. I mean, what's next? Are we going to let them just do whatever they want and not be held accountable for their actions? 
It's just not right 
It's not like they're hiding in a dark room, but rather they just have clever accountants who can make their money disappear. 
. It's not even fair that companies like Apple and Nike get to keep dodging this tax.
ugh american corps r literally getting away with murder over here 
they're just gonna keep siphoning off profits to low-tax havens while the rest of the world is trying to level the playing field 
and now other countries are probably gonna follow suit bc why not, right? 
. I mean, I get it, the US wants to protect its businesses, but come on! A global minimum tax rate of 15% sounds like a good idea to me 
. And what about all those companies like Apple and Nike who are basically just hiding profits in tax havens? It's like, hello! That's not right 
.
. So, it's not just American companies being exempted, but also companies that have significant operations in the US.
. They get to keep on keeping their profits in those low-tax havens, while everyone else has to follow some new global minimum tax rate. It's just not fair 
. This just feels so... corporate 
.
But... 
It's ridiculous that the US is exempt from the agreement, considering how much corporations are able to get away with in terms of taxes. 
as an alternative to traditional college degrees... it's like, you can get certified to taste all these different foods and drinks from around the world! Can you imagine a whole career built on just sampling wine and sushi? Anyway, this tax deal thingy reminds me of how some restaurants in LA have those fake parking tickets 