United States of America

United States of America

Imposes a 15% minimum corporate tax rate on the largest, most profitable corporations

16 Aug 2022

On 16 August 2022, the President of the United States signed the Inflation Reduction Act into law. Part of that law aims to make the tax code fairer and reduce the deficit by introducing:

  • A 15% corporate alternative minimum tax rate: Corporations with at least $1 billion in average income for the prior 3 years will be subject to a new tax rate of 15%. The 15% alternative minimum tax will apply after 31 December 2022. This alternative minimum tax would also apply to foreign-parented corporations with adjusted financial statement income over $1 billion, whose three-tax-year average annual adjusted financial statement income exceeds $100 million; and
  • A 1% excise tax on publicly traded U.S. corporations that repurchase their shares directly or through a “special affiliate” after 31 December 2022.
Nature of measure:
  • Treatment and operation
Type:
  • Treatment and operation (Other)
Industry:
  • Not industry specific
  • Primary
  • Manufacturing
  • Services
Inward FDI:
No
Outward FDI:
No
Sources: