Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

January 22, 2021

Report on recent US international tax developments 22 January 2021

Joe Biden was inaugurated as the 46th President of the United States (US) on 20 January, and with Vice-President Kamala Harris holding the tiebreaking vote, the Senate is now split 50-50 Democrats to Republicans. Against the backdrop of this new political landscape, Treasury Secretary-designate Janet Yellen on 19 January testified at her Senate Finance Committee confirmation hearing, confirming that the incoming Administration plans to delay tax increases for now due to the coronavirus pandemic.

Yellen noted that Biden had said that eventually, as part of a larger package with spending and investment proposals, the President would want to repeal parts of the 2017 tax cuts that benefited the wealthy and large companies, and reverse incentives for companies to offshore operations and profits. However, Biden has been clear that he does not want to completely repeal the Tax Cuts and Jobs Act. She said a provision in that law had the byproduct of rewarding corporations for moving operations offshore.

Yellen also said the US will work with other countries in negotiations to stop a “race to the bottom” on corporate taxation and, within that process, ensure competitiveness of American corporations. She affirmed that it is important for US companies to be globally competitive and said the Organisation for Economic Co-operation and Development (OECD) negotiations are important for that reason.

In response to a written question regarding the current OECD BEPS1 2.0 negotiations that was posed to the Treasury Secretary-designate by a member of the Senate Finance Committee following her testimony, Yellen wrote: “the Administration will vigorously reengage with multilateral efforts to update global tax rules in ways that establish minimum taxation, prevent profit-shifting, and support a level playing field.” She added that if confirmed, she would ensure that Treasury “immediately and vigorously engages with the international tax negotiations at the OECD.”


1. BEPS: Base Erosion and Profit Shifting.


For additional information with respect to this Alert, please contact the following:

Ernst & Young LLP, International Tax and Transaction Services, Washington, DC



The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.


Copyright © 2024, Ernst & Young LLP.


All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.


Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.


"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.


Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or Please refer to the privacy notice/policy on these sites for more information.

Yes, I accept         Find out more