US will proceed with global minimum tax despite domestic opposition, says Yellen

You United States will look for every opportunity to move forward and pass a global agreement on a minimum corporate tax, despite opposition from a top Democratic senator, Joe Manchin, to raising taxes, the Treasury secretary said. Janet Yellen .

Yellen told reporters on Saturday (16) that the financial authorities of the G20 reached consensus on many issues, including the need to address a worsening food security crisis despite differences over the Russian war in Ukraine that prevented the leaders from issuing a joint statement.

Manchin, who holds a crucial vote in the Senate, split between 50 government senators and 50 opposition senators, said this week he would not support a Democratic proposal for new climate change spending and higher taxes for businesses and wealthier Americans.

Your opposition could jeopardize the passage of legislation that would commit the United States to a global minimum corporate tax 15%, a key part of a deal Yellen helped negotiate with nearly 140 countries in 2021.

“We are very committed to moving forward with this. This is a really important global initiative,” she said on the second day of a two-day G20 meeting in Bali. “I can say that we will continue to look for every possible opportunity that we have to take this forward.”

She said the United States has a strong incentive to move forward because as other countries enact the tax deal, they would be taxing the foreign profits of US companies, while the country would be leaving “that tax revenue on the table rather than capture it”.

Yellen said it’s important that Manchin has signaled support for legislation to lower prescription drug prices for seniors and extend subsidies that help keep health insurance costs lower.

In her opposition to the climate change provisions, Yellen said the Treasury would support the President of the United States’ plans, Joe Biden to use executive actions and would continue the Financial Stability Oversight Board’s initiatives to assess the risks posed by climate change for financial institutions.

She also addressed the recent strong appreciation of the dollar and said that this is due to the country’s economic growth, Federal Reserve to raise interest rates and capital inflows.

“The US position is that we believe in market-determined exchange rates” and it is rarely appropriate to intervene, Yellen said, adding that “I don’t see this as one of those occasions.”