OECD chief ‘quietly optimistic’ about EU global minimum tax deal approval

div classBodysc17zpet90 cdBBJodivpBy Dan Burnsp

pDAVOS, Switzerland Reuters – The head of the Organisation for Economic Cooperation and Development OECD on Tuesday said he was “quietly optimistic” a landmark deal to establish a global minimum tax will be approved by European Union members but implementation may not occur until 2024.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pOECD Secretary General Mathias Cormann also told a panel at the World Economic Forum in Davos, Switzerland, that it was “manifestly” in the interest of the United States to join the deal struck last year among nearly 140 countries to establish a global minimum tax rate of 15 on multinational corporations. p

p“Im quietly optimistic the European Commission will be presenting the directive to implement” the deal, Cormann said.p

pCormanns remarks came as French Finance Minister Bruno Le Maire said on Tuesday he was confident EU finance ministers would unanimously back the global minimum tax next month.p

pApproval by the EU has been held up by objections from Poland, which vetoed a compromise in April to launch the 137country deal. p

pU.S. approval, meanwhile, has been stalled in Congress, and Cormann was asked if prospects for U.S. ratification would be scuppered should Republicans who broadly oppose the deal win majorities in the House of Representatives and Senate in Novembers midterm elections. p

pThe deal could be implemented by other countries even if U.S. legislators decline to sign on, and Cormann argued that would put U.S. multinational businesses at a disadvantage.p

p“I can‘t imagine that any country … would make a judgment that would put themselves at that sort of disadvantage,” Cormann said. “I believe that irrespective of who’s in the majority in Congress … this is manifestly in the U.S. interest.”p

pCongress needs to approve changes to the current 10.5 U.S. global overseas minimum tax known as “GILTI”, raising the rate to 15 and converting it to a countrybycountry system.p

pThe changes were initially included in U.S. President Joe Bidens sweeping social and climate bill, which stalled last year after objections from centrist Senate Democrats.p

pBut prospects for a slimmeddown spending package with the tax changes look increasingly difficult as midterm congressional elections approach and as lawmakers voice concerns about more spending amid high inflation.p

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pp Reporting by Dan Burns editing by Jason Neelyp

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