World Economy: Janet Yellen Confident That Global Corporate Minimum Tax Gets Passed

Treasury Secretary Janet Yellen expressed confidence Sunday that legislation to implement the global corporate minimum tax will be approved by Congress despite Republican opposition.

“Yes. I am confident that what we need to do to come into compliance with the minimum tax will be included in a reconciliation package. I hope that we, that it will be passed, and we will be able to reassure the world that the United States will do its part,” Yellen said on ABC News’ “This Week.”

On Friday, a group of 136 countries set a minimum global tax rate of 15% from 2023 for big companies. Yellen, who previously served as the Federal Reserve Chair, had spearheaded the proposal, which could raise $150 billion in revenues each year.

The global minimum tax will presumably be added to President Joe Biden’s reconciliation budget bill, which includes spending initiatives. Such a bill would allow Democrats to reach an agreement without Republican votes. Republicans have long been against implementing a global tax.

The minimum global tax rate is a “voluntary agreement among countries” to individually impose a minimum tax on corporations’ overseas earnings. It also has the potential to reshape global business by ending how companies use some small countries’ lowest tax jurisdictions.