Official statements from the European Union or its member states

Trump Withdraws U.S. from OECD Tax Pact, Orders Retaliation Within 60 Days

Jan 21, 2025, 01:27 PM

U.S. President Donald Trump has issued an executive order directing officials to draft retaliatory measures against countries imposing 'extraterritorial' taxes on American multinationals. This move marks the U.S. withdrawal from the OECD global tax agreement, which had been endorsed by 139 countries and aimed to establish a global minimum tax rate of 15% for multinational corporations. Trump's order also mandates a review of foreign tax policies that may disproportionately affect U.S. companies, with a list of protective measures to be prepared within 60 days. The OECD agreement, partially implemented by several nations, was projected to generate $192 billion annually by increasing tax contributions from major global corporations. Trump's actions have drawn criticism from international organizations and European leaders, who view the move as a challenge to global tax norms. The U.S. administration argues that such taxes unfairly target American companies, particularly tech giants like Apple and Alphabet. The European Union and other signatories have expressed regret over the U.S. decision but remain committed to the agreement. Analysts suggest this development could escalate into broader economic tensions, as the U.S. considers imposing additional taxes on foreign-owned companies operating domestically.