Last week, the finance ministers of Europe’s five biggest economies — Germany, France, the UK, Spain and Italy — wrote an anxious letter to their American colleague, US Treasury Secretary Stephen Mnuchin, and copied it to all senior Republican politicians in the Congress and Senate. The letter’s thrust: The draft US tax bill, if passed as written a week ago, would represent a break with global fair-taxation rules as applied to corporations, and represent a thinly disguised form of trade war.
“The United States is Europe’s single most important trade and investment partner,” the finance ministers wrote. “It is important that the U.S. government’s rights over domestic tax policy be exercised in a way that adheres with international obligations to which it has signed-up.
The inclusion of certain less conventional international tax provisions could contravene the US’s double taxation treaties and may risk having a major distortive impact on international trade.” Send Facebook Twitter Google+ Whatsapp Tumblr linkedin stumble Digg reddit Newsvine A day later, a similar letter was sent to Mnuchin by the European Commission’s four most senior economic officials and made many of the same points.
The two letters didn’t get much of an answer — at least not a public one, though quiet edits to the bills taking European concerns into account may be happening behind the scenes. Draft federal legislation in the US always exists in at least two separate versions: one drafted in the Senate, and the other in the House of Congress.
The “conference process” is the negotiation that reconciles the differing House and Senate versions of a draft bill. It’s due to come to a close this week. Read more from dw.com…
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