Under current law, US shareholders can reduce their global minimum tax by 10% of their return on QBAI, which generally refers to foreign tangible property.

The proposal would eliminate the current qualified business asset income (QBAI) exclusion. The Administration proposes several changes to the US “global minimum tax” regime, formally known as the global intangible low-taxed income (GILTI) provisions. The new rate would be prorated for non-calendar tax years that begin during 2021. The new tax rate is proposed to be effective for tax years beginning after December 31, 2021. Corporate tax rate increaseĪs anticipated, the Administration proposes to increase the corporate tax rate from 21% to 28% – splitting the difference between the rate set by the 2017 tax reform and the rate before that (35%). The American Families Plan includes individual income tax provisions and provisions aimed at tax compliance and administration.

The tax proposals in the Green Book are divided into those under the “American Jobs Plan” and the “American Families Plan.” The American Jobs Plan includes corporate tax reform, housing and infrastructure tax support, and clean energy tax provisions. The Green Book, the colloquial name for the formally titled “General Explanations of the Administration’s Fiscal Year 2022 Revenue Proposals,” includes the detailed legislative explanations for these proposals.

Many of the corporate tax proposals were first announced in broad terms in the President’s “Made in America Tax Plan” released in March. The US Treasury’s Green Book, released today alongside President Biden’s FY 2022 Budget, outlines the specific tax provisions that the Administration seeks to enact this year, including significant proposals for overhauling the international tax rules applicable to corporations.

Treausry greenbooks