OECD finalizes deal on global minimum tax with US carveout

The United States, along with more than 100 countries, has finalized an agreement exempting American firms from certain foreign taxes -- an update that follows Washington's push for exclusions from a global minimum tax.

Countries had struck a deal in 2021 to tax multinational companies, in an agreement negotiated under the auspices of the Organisation for Economic Co-operation and Development (OECD).

The deal contains two "pillars," the second of which sets a minimum global tax rate of 15 percent.

But US President Donald Trump has pushed back on the global tax agreement, saying the proposed pact would have no force or effect for the United States.

On Monday, the US Treasury Department said that it had worked to "reach agreement with the more than 145 countries in the OECD/G20 Inclusive Framework to have US-headquartered companies remain subject to only US 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 US companies and the tax sovereignty of other countries over business activity within their own borders," the Treasury added.

The update came after the Group of Seven (G7) nations agreed in June to exempt US multinational companies from a global minimum tax imposed by other countries.

At the time, Treasury Secretary Scott Bessent said he had asked Congress to remove a provision from a draft of Trump's "One, Big, Beautiful Bill" that had been dubbed a "revenge tax," following progress on this agreement among the G7.

The provision would have allowed the government to impose levies on firms with foreign owners, and on investors from countries deemed to impose unfair taxes on US businesses.