Treasury Secretary Janet Yellen today said the Biden administration will yoke the United States to a tax regime with the likes of China, Russia, Saudi Arabia, and Indonesia.
Yellen and the Biden administration want to surrender U.S. sovereignty to foreign leaders in Russia, China, Saudi Arabia, Indonesia, and the EU in order to bind the world into higher taxes and bigger government.
This would take the form of a corporate global minimum tax, designed to “end the pressures of tax competition” and “make all citizens fairly share the burden of financing government.”
According to Yellen, the Biden administration will achieve these goals by working with the G20 – a global forum that includes Argentina, Australia, Brazil, Canada, China, France, Germany, Japan, India, Indonesia, Italy, Mexico, Russia, South Africa, Saudi Arabia, South Korea, Turkey, the United Kingdom, and the European Union.
If this pact for global minimum taxes goes into effect, it will harm American workers and businesses who will be paying higher taxes to finance wasteful spending in the U.S. and across the world.
Can the U.S. really trust foreign countries – many of which have a history of undemocratic governance and human rights violations — to play by the rules in a way that ensures American businesses and workers are treated fairly?
The push to impose a global minimum tax shows that the Biden administration is not prioritizing American workers, families and businesses but instead wants to expand the power that the federal government has over the U.S. economy and the power that global organizations have over economies across the world.
This is not the first time Democrats have taken aim at tax competition in recent months. During consideration of the $1.9 trillion Biden spending plan passed last month, Congressional Democrats snuck in a provision giving federal bureaucrats veto power over any state tax cut until 2024 if the state accepted a portion of the $350 billion in state and local aid.
Democrats are pushing these policies to suppress competition because they know that imposing tax hikes in the U.S. will make America less competitive. Biden is calling for a $2 trillion tax hike on businesses and workers which calls for a 21 percent global minimum tax and proposes raising the corporate from 21 percent to 28 percent, a 33 percent increase.
If enacted, these tax hikes will send American jobs overseas and reduce wages and economic opportunity for U.S. workers.
Rather than colluding with foreign governments to keep taxes high, the Biden administration should ensure our tax code remains globally competitive. After Republicans passed the 2017 tax cuts, the U.S. was named the most competitive economy in the world.
The U.S. grew faster than rest of the world and was the only G7 industrialized country to record annual real GDP growth exceeding 2 percent in 2018 or 2019. The U.S. growth rate of 2.9 percent in 2018 was significantly higher than other developed countries like Germany, which saw 1.5 percent growth and the United Kingdom, which grew by just 1.3 percent.
Yellen’s push to impose a global minimum tax shows that the Biden administration is not focused on helping American workers, families and businesses. Not only do they want higher taxes in America, they also want to work with foreign countries including Russia and China to lock in higher taxes across the world and end tax competition.