Yellen of the US says Reuters is not ready for major corporate tax changes until 2022

VENICE (Reuters) – US Treasury Secretary Janet Yellen said on Sunday that more countries would not be ready for lawmakers to consider until the spring of 2022 a new mechanism for taxing large multinational high-income companies.

Yellen said in a press conference after a meeting of G20 finance leaders in Venice in Italy that the “Pillar 1” of the OECD reassigning tax rights is “slightly slower than the global minimum corporate tax of 15%.” The main tax agreement in 132 countries.

G20 finance ministers and central bank governors approved the deal over the weekend, but doubts remain to convince Congress that U.S. President Joe Biden’s administration is widely divided to ratify the changes.

Yellen said he hopes that the so-called “column 2” global minimum tax provisions for this year’s budget “reconciliation” bill will be approved by Congress by a simple majority.

Section “Pillar 1” of the agreement would unilaterally end taxes on digital services in exchange for a new mechanism that would allow large profitable companies to tax based on where they sell products and services, rather than where their headquarters and intellectual property are located. live.

This will require a multilateral tax deal that will take time to negotiate, a Treasury official said.

“Pillar 1 will be a little slower. We will work with Congress,” Yellen said, when asked if a two-thirds majority would be needed in the U.S. Senate, which is usually a requirement for international treaties.

“We may be ready in the spring of 2022 and we will make an effort to determine at that time what needs to be implemented,” Yellen said.