Professor Rebecca Kysar discusses the path to implementing Pillar One and Pillar Two of the 2021 global tax deal in a Bloomberg Tax article.
US implementation of a 2021 deal to overhaul global tax rules may not make fast progress after the
midterm elections, regardless of which party controls Congress.A GOP-led House is likely to spend more time challenging Treasury Secretary Janet Yellen on how
the deal came together and its economic impact while Democrats may lack momentum to move parts
of the deal.Under the 2021 global tax deal, nearly 140 countries agreed to a reallocation of the largest
multinationals’ profits—known as Pillar One—and a 15% global minimum corporate tax rate, known
as Pillar Two.…
But another path to approving the convention is possible—a congressional executive agreement,
which is routinely used to implement international agreements, said Rebecca Kysar, professor at
Fordham University School of Law who previously served as counselor to the assistant secretary of
tax policy at the US Treasury Department in the Biden administration.“There is no reason, other than politics, why the United States could not take that path here,” Kysar
said.…
“The next likely time for US implementation of Pillar 2 is 2025, when many significant tax provisions
are scheduled to expire,” Kysar said in an email.“Although this seems far away now, it gives Europe and other major economies the time they need to
move forward. The fact that the United States has come so far in implementation before other nations
have acted should give them the confidence to do so,” she added, pointing to the US’s adoption of the GILTI rules in 2017 and the book minimum tax in 2022.
