Letter to Members of Congress

December 17, 2021

Dear Member of Congress: 

We write today as members of the PACE Coalition, a broad-based organization dedicated to  promoting U.S. job growth and a strong U.S. economy through policies that support the  global competitiveness of American workers and American businesses. As the Senate  begins to consider H.R. 5376, the Build Back Better Act, PACE strongly urges you to reject  international tax proposals that would severely harm U.S. competitiveness.  

The House-passed version of H.R. 5376 would further tilt the playing field against American  businesses by imposing significantly higher taxes under the Global Intangible Low-Taxed  Income (GILTI) provision. The United States is already the only country in the world that  imposes a minimum tax on the active income that its companies earn abroad. Increasing  the GILTI tax burden – before any other country has taken even preliminary steps to adopt  their own foreign minimum tax – would significantly diminish the ability of American  companies to compete in global markets and decrease the demand for goods and services  produced by American companies and their American workers.  

Congress should prevent a loss in American jobs caused by the unilateral adoption of higher  taxes only on American companies. While many countries have endorsed the OECD  statement on voluntary implementation of foreign minimum taxes, no other country in the  world has yet adopted a foreign minimum tax. Further, an endorsement of the OECD  statement does not require any country to adopt a foreign minimum tax of their own.  

OECD final guidelines on a foreign minimum tax have been repeatedly delayed and there  are no signs that other countries, including China, are planning to enact a foreign minimum  tax in the next several years. Further, even if every country moved to adoption  immediately, the House-passed bill would still impose a more restrictive foreign minimum  tax on American companies than the foreign minimum tax outlined by the OECD. 

Unless and until other countries implement their own foreign minimum taxes, there should  be no increases in GILTI taxes on the foreign earnings of American companies. Likewise,  the present-law tax rate on foreign-derived intangible income (FDII) should also be  maintained to be in parity with the GILTI tax rate and continue its important role in  incentivizing U.S. development and ownership of intellectual property.  


Alliance for Competitive Taxation (ACT) 

American Beverage Association 

American Chemistry Council

American Petroleum Institute 

Business Roundtable 

Council of Insurance Agents and Brokers 

Energy Workforce & Technology Council  

Glass Packaging Institute  

Illinois Manufacturers’ Association 

Indiana Manufacturers Association  

National Association of Manufacturers  

National Foreign Trade Council  

State Business Executives  

U.S. Chamber of Commerce 

United States Council for International Business

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