The Biden Administration hopes a new global minimum corporate tax will dampen the blow of its tax increases on the U.S. economy. But other governments are making it clearer by the day that they won’t play along.
Treasury Secretary Janet Yellen has thrown herself enthusiastically into negotiations at the Organization for Economic Cooperation and Development to write such a global tax regime. President Biden wants to impose a form of alternative minimum tax on corporate profits earned overseas, with a statutory rate of 21% and an effective rate that’s higher for many companies. Even the progressives manning the Biden barricades realize this will throttle U.S. competitiveness if other countries don’t impose similar taxes.
Ms. Yellen might have thought long-running OECD negotiations toward a global minimum tax would be an easy way to achieve this goal. Instead, European governments are adopting a version of Napoleon’s maxim: Never interrupt Washington while it’s harming itself.