U.S. Secretary of the Treasury Scott Bessent issued the following statement today on the non-applicability of OECD Pillar Two to U.S. Multinationals:
President Trump’s Day One Executive Orders made clear that the Biden Administration’s proposed OECD Pillar Two deal would have no force or effect for the United States.
Today, the Administration delivered on that promise. In close coordination with Congress, Treasury worked to reach agreement with the more than 145 countries in the OECD/G20 Inclusive Framework to have U.S.-headquartered companies remain subject to only U.S. global minimum taxes while exempting them from Pillar Two. This side-by-side agreement recognizes the tax sovereignty of the United States over the worldwide operations of U.S companies and the tax sovereignty of other countries over business activity within their own borders.
Further, the agreement protects the value of the U.S. R&D credit and other Congressionally approved incentives for investment and job creation in the United States, fulfilling the shared goal of U.S. leadership in innovation and technological advancement.
This agreement represents a historic victory in preserving U.S. sovereignty and protecting American workers and businesses from extraterritorial overreach.
Treasury will continue engaging with foreign countries to ensure full implementation of the agreement, build greater international tax stability, and move toward a constructive dialogue on the taxation of the digital economy.