Three moderate House Democrats are urging party leaders to “pause” a key piece of President Biden’s tax plan that would raise the minimum rate that U.S. corporations pay on their overseas income.
In a letter to House Speaker Nancy Pelosi, D-Calif., and House Ways and Means Chairman Richard Neal, D-Mass., the lawmakers said they wanted to wait and see how other countries implement a new global agreement that would establish a 15% minimum rate on multinational corporations, regardless of where they’re headquartered. That deal, struck this month by 136 countries and jurisdictions, could take years to enact worldwide.
The centrist Democrats warned that otherwise, a plan from the tax-writing House Ways and Means Committee to raise an existing levy on companies’ foreign earnings – known as the global intangible low-taxed income (GILTI) rate – would hurt American firms. A plan released last month called for raising the GILTI rate to 16.5%, from 10.5%.
“I would encourage Leadership to pause on moving forward with GILTI and international tax changes at this time,” the letter said. “We must find a new pathway to ensure that we do not move before the rest of the world on implementing a new GILTI regime. While well-intentioned, the GILTI changes as proposed would potentially reduce American competitiveness with their foreign counterparts and result in American job losses.”
The letter, which was first reported by Politico, was signed by Reps. Tom O’Halleran of Arizona, Lou Correa of California and Henry Cuellar of Texas, all of whom are members of the New Democrat Coalition…Read more>>