GOP working with Hungary to derail global minimum tax

[NewYorkExpress]

https://www.washingtonpost.com/us-policy/2022/07/01/hungary-gop-tax-deal/

Senior Hungarian officials say they are working with Republican lawmakers in the United States to defeat a global minimum tax backed by the Biden administration, as European and American leaders struggle to enact a groundbreaking international accord targeting multinational corporations.

Peter Szijjarto, Hungary’s foreign minister, said this week that he is taking advice from GOP officials on resisting the U.S.-supported attempt to set an international floor on corporate taxation, although the extent of that communication is not clear. With a right-wing government led by Prime Minister Viktor Orban, Hungary is effectively holding up implementation of the tax deal in Europe, because each country in the European Union has veto power over the bloc’s tax agreements. All other E.U. member countries support the proposal. The United States has not implemented the agreement yet, either, amid a broader standoff in Congress over President Biden’s economic agenda, and some Democrats are cautious about implementing the new international tax rules if the Europeans do not do so simultaneously.

The global pact, a long-standing goal of Treasury Secretary Janet L. Yellen, would establish a minimum 15 percent tax on large multinational firms in an attempt to arrest the decades-long decline in corporate tax revenue collected by Western governments. The Biden administration has said the proposal is necessary to ensure that governments can fund social services and avoid a mutually damaging “race to the bottom” by nations to cut corporate tax rates to attract businesses. But those efforts have been strongly resisted by Republicans, who say the new rules include loopholes that will hurt the international competitiveness of American firms.


The deal appears at risk because of the roadblocks in Europe and in Congress. That dynamic is self-sustaining: Several Hungarian officials have in recent days pointed to resistance to the plan among Republican lawmakers as a reason for Hungary to hold off, and American opponents of the plan have in turn pointed to resistance to the effort in Europe, hardening an impasse that the White House has not been able to resolve.


“We are constantly consulting with the Republicans. There is a constant professional consultation on this issue,” said Szijjarto, a member of Orban’s government, in an interview posted on Facebook. Hungary has one of the lowest tax rates in Europe. “We think that the lower the taxes on labor and businesses the more it helps in terms of competitiveness.”

The extent of the GOP collaboration with Hungarian officials was not immediately clear. GOP Reps. Adrian Smith (Neb.) and Mike Kelly (Pa.), top members of the House Ways and Means Committee, sent a letter to the ambassador of Hungary last week commending that country for rejecting the global tax deal. The letter was released by Hungarian media and later confirmed by spokespeople for the lawmakers, who did not post it to their congressional websites or social media pages. Spokespeople for both lawmakers said they were not in contact with Hungarian officials beyond the letter. The anti-tax crusader Grover Norquist also released a letter in June praising the Hungarians but said in an interview that he has not lobbied individual Hungarian lawmakers. Sen. Patrick J. Toomey (R-Pa.) also commended Hungary’s stance, although an aide to Toomey said the senator has not met with Hungarian officials. Toomey has met with officials of Britain, France and Ireland to build opposition to the deal, the aide said.

[wesmoorenerd]

There exists a nefarious global network of right-wing populists and authoritarian wannabes. From the GOP to Fidesz to right-wing parties across Europe and beyond, they're all in cahoots to suppress liberal democracy and enrich their wealthy backers. This is the new Axis, one that cuts across national borders rather than along them, and its destruction should be seen as the primary goal of anyone who cares about democracy, liberty, and equality.

[Hammy]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

[President Johnson]

Well, it's been evident for some time now that Republicans are going down the road of Fidesz. So this is not necessarily a surprise at all.

[lfromnj]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

Our country was literally founded on avoiding taxes controlled by European officials by using other European countries.

[Hindsight was 2020]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

Our country was literally founded on avoiding taxes controlled by European officials by using other European countries.

Our country was founded by people upset that everyday people were getting taxed by a government that didn’t give them any representation in parliament. Not in any way comparable to a global minimum tax standard on massive corporations

[TiltsAreUnderrated]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

Our country was literally founded on avoiding taxes controlled by European officials by using other European countries.

Avoiding European-imposed taxes, not vice versa. The base rate of European corporation tax is, on average, lower - and the plan would not only set a floor but close a bunch of loopholes only possible because of globalisation.

I can see why you'd back this, but it's not very #populist to help transnational corporations use unregulated globalisation to escape reinvesting in the US.

[Mr. Reactionary]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

Our country was literally founded on avoiding taxes controlled by European officials by using other European countries.

Avoiding European-imposed taxes, not vice versa. The base rate of European corporation tax is, on average, lower - and the plan would not only set a floor but close a bunch of loopholes only possible because of globalisation.

I can see why you'd back this, but it's not very #populist to help transnational corporations use unregulated globalisation to escape reinvesting in the US.

The main reason for the opposition is that it cedes taxing authority from Congress to foreign powers. I think its good to limit international tax avoidance but its worrisome to tie our tax policy to foreign law.

[Sir Mohamed]

Well, it's been evident for some time now that Republicans are going down the road of Fidesz. So this is not necessarily a surprise at all.

Fidesz, as bad as they are, even seem less insane than the GOP these days.

[Vice President Christian Man]

I'm not too familiar with this issue but would it just target multinational corporations?

[It’s so Joever]

Right on cue, the people who claim Democrats are trying to destroy America are found working with an authoritarian government that stands in deep contrast to everything they claim this country was founded on

Our country was literally founded on avoiding taxes controlled by European officials by using other European countries.

True, that is why the British were correct in the Revolutionary War. Rare time considering how usually terrible the empire was in many ways.

[Vosem]

Well, it's been evident for some time now that Republicans are going down the road of Fidesz. So this is not necessarily a surprise at all.

This seems much more like American influence on Hungary than like Hungarian influence on the United States.