President Trump is poised to receive a report today (21 March) on the Administration's proposed response to BEPS 2.0 Pillar Two Top-Up Taxes (such as the UTPR, commonly called the Under-Taxed Payments Rule) and other taxes it views as "extraterritorial" or that "disproportionately affect American companies" (e.g., Digital Services Taxes). Additional reports are due to be delivered to the President on 1 April. The precise timing of when the Administration might release details of the reports to the public, or further guidance relating to the reports, is unclear.

As a reminder, President Trump has issued four related memoranda since assuming office. Separately, the "Defending American Jobs and Investment Act" (H.R. 591 ), was introduced on 21 January 2025 by House Ways and Means Committee Chairman Jason Smith (R-MO), and also targets discriminatory or extraterritorial foreign taxes. The four Administration policy memoranda are:

• The Organization for Economic Co-operation and Development (OECD) Global Tax Deal (Global Tax Deal) — The White House (20 January 2025)
• America First Trade Policy — The White House (20 January 2025)
• Defending American Companies and Innovators From Overseas Extortion and Unfair Fines and Penalties — The White House (21 February 2025)
• America First Investment Policy — The White House (21 February 2025)

The proposed bill (H.R. 591), which is currently only a legislative proposal, would introduce a new Section 899 to the Code that is similar to existing IRC Section 891. Proposed IRC Section 899 would generally modernize and operationalize IRC Section 891 by providing (1) a process and timeline for identifying countries that have discriminatory or extraterritorial taxes, (2) a schedule for gradually increasing rates on corporations and citizens of the relevant foreign country, and (3) a coordinating rule that would require increases to US withholding tax rates in line with the increases in rates imposed on the foreign country's corporations and citizens.

Congress was in recess this week and both chambers will return to Washington next week, with the House expected to resume work on a budget reconciliation bill. The House and Senate must each pass an identical budget resolution to unlock the budget reconciliation process. While the House passed a budget resolution in February, the Senate is expected to pass its budget resolution sometime in the near term.