US Treasury issues new proposals for 15% minimum corporate tax

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WASHINGTON, United States (AFP) – The US Treasury Department unveiled new proposals Thursday to implement a rule requiring some of America’s largest corporations to pay a minimum corporate tax rate of 15 percent.

The proposed rules are designed to execute the Corporate Alternative Minimum Tax (CAMT), which formed part of the Inflation Reduction Act, one of President Joe Biden’s signature pieces of legislation.

It applies to corporations averaging more than $1 billion in profits that currently pay less than 15 percent in corporate taxes on their adjusted profits each year, the Treasury Department said in a statement.

Thursday’s notice of proposed rulemaking “would implement the statutory requirement that the biggest corporations pay a minimum 15% tax on profits reported to shareholders,” according to the Treasury.

“Some of the most profitable corporations in the country report record profits to shareholders while using complex tax strategies to pay little to no taxes, often paying lower tax rates than nurses, firefighters, police officers and teachers,” said deputy Treasury secretary Wally Adeyemo.

“The ability to use accountants and lawyers to reduce tax bills down to zero gives billion-dollar corporations a competitive advantage over small businesses,” he told reporters in a briefing before the proposals were published.

The new rules would affect around 100 companies who currently pay an average federal tax rate of just 2.6 percent. The Treasury estimates it will generate more than $250 billion in tax revenues over a decade, including $20 billion in 2025.

“The corporate minimum tax is a milestone for the Biden-Harris administration tax fairness agenda,” White House National Economic Advisor Lael Brainard told reporters.

“This helps to level the playing field for small businesses, which have seen a boom under this administration,” she added.

Stakeholders now have until December to comment on the Treasury’s proposals.

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US Treasury issues new proposals for 15% minimum corporate tax

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