“If Congress doesn’t adopt, that doesn’t prevent the European Union and Japan and others from moving forward in this area, at which point, I think, Congress would see it’s in the U.S. interest to adopt, because otherwise our companies will also get hit by this enforcement principle,” Kimberly Clausing, who recently left her job as Treasury’s deputy assistant secretary for tax analysis, said at a Tax Policy Center event last month.
Barbara Angus, the global tax policy leader at Ernst Young, said a failure by the United States to comply with the deal would have “significant implications” for American companies.
“For this framework to work as it’s intended, there really does need to be consistency and coordination,” said Ms. Angus, who is also a former chief tax counsel on the House Ways and Means Committee.
The Treasury Department could not provide an estimate for how much additional tax American companies would have to pay to foreign governments if the United States was left out of the global agreement. If fully enacted, the agreement is projected to raise about $200 billion of tax revenue for the United States over a decade.
Pascal Saint-Amans, director of the center for tax policy and administration at the Organization for Economic Cooperation and Development, said he thought that the European Union would find a way to move beyond member state opposition and that, once it ratified that agreement, the United States would come under pressure to join.
“Once E.U. has moved, U.S. has the following choice: Either they move or they leave the taxing right on U.S. multinational enterprises to the Europeans,” Mr. Saint-Amans said in a text message. “Even the Republicans would not let this go.”
Article source: https://www.nytimes.com/2022/07/18/us/politics/joe-manchin-tax.html
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