Scott, Finance Republicans Demand Treasury Analysis of OECD Agreement
WASHINGTON – U.S. Senator Tim Scott (R-S.C.), along with Finance Committee Ranking Member Mike Crapo (R-Idaho) and all other Senate Finance Committee Republicans, wrote to Treasury Secretary Janet Yellen renewing requests for information regarding international tax negotiations. To date, the Department of the Treasury (USDT) has been unwilling or unable to fully engage with Congress to provide details on the negotiations, which will have a significant impact on American workers, businesses and revenue.
The senators raise concerns with how the negotiations may negatively impact U.S. competitiveness; the commitment from the United States to increase its global minimum tax before any other country; and suggestions that USDT could implement the agreement without the advice and consent of the Senate, bypassing the treaty process.
“The Administration’s rush to reach a political agreement, tied to its domestic spending plans and pursuit of revenue, has come at the expense of thorough analysis and meaningful engagement with Congress and the business community, and may ultimately put U.S. businesses at risk. . . . Given this agreement’s potential to jeopardize U.S. competitiveness, we continue to have concerns with the lack of detail underlying the approach being proposed under Pillar One and its lack of foundation in any discernible tax principles,” the senators wrote.
“Further troubling is Treasury’s continued insistence that the United States once again move first by significantly increasing the U.S. global minimum tax. . . . As Pillar Two does not require other countries to adopt a global minimum tax, we are not confident that our biggest foreign competitors, like China, will enact and implement a global minimum tax on the same terms or on the timeline agreed to at the OECD. …
“Finally, suggestions that the United States could fully implement Pillar One without the advice and consent of two-thirds of the Senate through the treaty process are highly problematic. . . . [A]ny suggestion that Pillar One can be implemented absent treaty ratification is a dramatic shift from past precedent and calls into question the binding nature of any such agreement, thereby threatening the very tax certainty that many of our companies, and this Administration, claim to seek under Pillar One.”
The senators end the letter with a detailed list of questions regarding the proposals, reiterating that any opportunity for a bipartisan outcome will require greater transparency and engagement from USDT.
Signing the letter along with Senator Scott and Ranking Member Crapo were all other Republican members of the Senate Finance Committee: Senators Chuck Grassley (R-Iowa), John Cornyn (R-Texas), John Thune (R-S.D.), Richard Burr (R-N.C.), Rob Portman (R-Ohio), Pat Toomey (R-Penn.), Bill Cassidy (R-La.), James Lankford (R-Okla.), Steve Daines (R-Mont.), Todd Young (R-Ind.), Ben Sasse (R-Neb.), and John Barrasso (R-Wyo.).
Full text of the letter can be found here.