US Treasury Secretary Janet Yellen working with G20 on global corporate minimum tax

US Treasury Secretary Janet Yellen said on Monday that she is working with G20 countries to agree on a global corporate minimum tax rate and pledged that restoring US multilateral leadership would strengthen the global economy and advance US interests.

In a speech ahead of her first International Monetary Fund and World Bank Spring Meetings as Treasury Secretary, Yellen signalled stronger US engagement on issues from climate change to human rights to tax base erosion.

A global minimum tax proposed by the Biden administration could help to end a “30-year race to the bottom on corporate tax rates,” Yellen told an online event hosted by the Chicago Council on Global Affairs.

The global minimum tax is a key pillar of President Joe Biden’s US$2 trillion infrastructure spending plan, which calls for an increase in the US corporate tax rate to 28 per cent while eliminating some deductions associated with overseas profits.

Without a global minimum, the United States would again have higher rates than a number of other major economies, tax experts say, while the US proposal could help jump-start negotiations for a tax deal among major economies.

Yellen also said she would use the IMF and World Bank meetings this week to advance discussions on climate change, improve vaccine access for poor countries and push countries to do more to support a strong global recovery from the coronavirus pandemic.