Senate Tax-Writing Chief Releases International Tax Ideas for Comment

April 5, 2021

Senate Finance Chairman Ron Wyden (D-Ore.) on Monday proposed ways to retool the international tax provisions that were included in the 2017 tax reform law.

The proposal, dubbed a “framework,” consists of ideas (and very few specifics) for how the international tax system could be reformed. Wyden worked with Senators Mark Warner (D-Va.) and Sherrod Brown (D-Ohio) on the framework.

The Senators have called on interested parties to comment on their proposals by April 23. It is expected that they will produce an international tax bill after they have reviewed the comments received. Comments and feedback can be emailed to

“We’re interested in getting input from all sides,” Wyden said.

Currently, the framework includes the following:

  • Increase the global intangible low-taxed income (GILTI) tax rate. The framework does not provide a specific rate increase.
  • Move GILTI to a country-by-country system, and away from its current global reporting system.
  • Create tax incentives to onshore research and development jobs.
  • Repeal the deduction on foreign-derived intangible income (FDII) if it cannot drive investment to the U.S.
  • Equalize the rates for GILTI (currently 10.5%) and FDII (currently 13.125%).
  • Reform the base erosion and anti-abuse tax (BEAT) to capture more revenue from companies eroding the U.S. tax base.
  • Create a higher tax bracket with income associated with base erosion.

The Wyden-Brown-Warner framework comes on the heels of President Biden last week outlining his $2.5 trillion American Jobs Plan that includes tax increases on multinational corporations. It is not clear at this point if the Senators proposals will become a part of the American Jobs Plan.

The American Jobs Plan as proposed:

  • Increases the corporate income tax rate from 21% to 28%.
  • Imposes a 21% global minimum tax on U.S. corporations, which would be calculated on a country-by-country basis. (The Biden plan also gives a tip of the hat to the OECD-led effort to adopt a global minimum tax).
  • Eliminates the rule allowing U.S. companies to pay zero taxes on the first 10% of profit when they locate investments in foreign countries. 
  • Repeals the Foreign Derived Intangible Income (FDII) deduction.
  • Creates a 15% minimum tax on book income for the largest corporations (not defined).
  • Denies company expense deductions for moving jobs offshore.
  • Imposes more restrictions on corporate inversions.
  • Eliminates special tax preferences for fossil fuels.

Treasury Secretary Janet Yellen spoke Monday on international tax policies and called for a global minimum corporate tax rate.

“We are working with G20 nations to agree to a global minimum corporate tax rate that can stop the race to the bottom. Together we can use a global minimum tax to make sure the global economy thrives based on a more level playing field in the taxation of multinational corporations, and spurs innovation, growth, and prosperity,” Yellen told a Chicago Council on Global Affairs audience.

Despite Yellen's encouragement for a global minimum tax, a finalized version of the American Jobs Plan, and the tax provisions it will include, is expected to take months to complete. At this point, it is unclear which tax measures will be a part of the final bill. 

Prior coverage:

Senate Finance Chairman Readies International Tax Bill with an Uncertain Fate

What is the American Jobs Infrastructure Proposal & What Taxes Would It Raise?

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