There are rules for RoW and there are rules for the USA. Astonishing that the G7 falls in this trap again and again (for example Basel III). The US was a major driver in pillar 2 but won‘t adhere to it. Probably companies will restructure their organization to have two streams and exploit it. Despite GILTI, some US companies have low ETRs.
miohtama · 2h ago
A lot of success of Magnificent 7 companies is tax optimisation, not just productivity gains.
For example you can check Amazon effective tax rate here
...or "Jeff Bezos did not get rich by paying taxes"
refurb · 1h ago
Productivity measures are calculated pre-tax.
muro · 1h ago
I think this is completely reasonable, services should use the same customs / duties mechanism on "import" as any other goods. The income tax should be also paid the same way. And if the product is created in multiple countries (licenses, Software Components etc), they are part of the whole product and tarifs for parts of goods should similarly apply.
saubeidl · 1h ago
On a related note:
> With just 13 days until the Trump-imposed deadline to conclude a EU-U.S. deal, European Commission President Ursula von der Leyen decided the time for conventional negotiating tactics was over.
> She floated the idea that the EU’s 27 countries could join forces with 12 members of the Asian-led Comprehensive and Progressive Agreement for Trans-Pacific Partnership bloc (CPTPP) — which now includes the U.K. — to form a new world trade initiative.
> The new grouping would redesign a rules-based global trading order, reforming or perhaps even replacing the now largely defunct World Trade Organization, she said.
> Crucially, the U.S. would not automatically be invited.
The US is locking itself out of world trade with their behavior. The price to pay for actions like these will far outweigh any benefits.
consumer451 · 1h ago
In EU-focused online forums, I have recently seen MAGA referred to as "Make America Go Away."
I chuckled at first, but as a beneficiary of Pax Americana, this is a really sad state of affairs. However, I am really pro-EU, and I hope that we are up to the task coming forth.
saubeidl · 1h ago
I don't see vassalage as something worth preserving. It's time for a Pax Europeana on European soil.
consumer451 · 1h ago
> It's time for a Pax Europeana on European soil.
I support this 100%, and have said nearly these exact words in the past. However, the concept of Pax __ applies to the entire "world." Even the USA's supposed enemies benefited from the rules based global order, a lot of the time. If Pax Europa is to be a thing, it needs to have effects beyond Europe's borders. The democratic European way, surviving and thriving, is the last hope for a bright near-term future for all of humanity. I truly believe this.
note: I edited my gp comment prior to seeing your response.
saubeidl · 1h ago
Pax Romana - the origin of this phrase - was limited to the Europe and the Mediterranean region. During that same time frame, Han Dynasty china was anything but at pax.
We can aim for the same regional scope again. I don't think all conflicts around the world should be our business.
consumer451 · 1h ago
Yes, maybe after your response, I put the word 'world' in scare quotes = "world" thinking about this exact issue. Other thoughts were 'known world,' 'visible world'... but those don't translate to today.
I need to set my profile's delay number higher to allow for more comment editing time.
saubeidl · 1h ago
But I think that's exactly the point - we only need to care about "our world".
Conflicts in Asia shouldn't be our problem, as an example. We should stop the US from dragging us into quagmires in the Middle East, etc etc.
What matters is that we have peace at home and the strength to preserve it. The rest shouldn't be up to us.
consumer451 · 56m ago
I hear what you are saying, and I respect it. However, what happens when some group threatens to shut down a major global shipping route that the EU relies on?
What happens when imperialism spreads near our borders, but not yet across them? Do we wait until the final moment to mobilize? That seems like horrible planning.
In the period between WW II and Iraq II, the USA used soft and military power to keep basic world order (country borders) and commerce running. It was the enforcer of the post-war Rules Based Order.
This was a good thing, that I believe we all took for granted. Even the USA has now taken that for granted. That historical period is now officially over.
What/who will fill that void of global stability?
ivandenysov · 54m ago
That was the case before long range weapons of mass destruction became a thing
delusional · 1h ago
> I chuckled at first, but as a beneficiary of Pax Americana, this is a really sad state of affairs
I've felt some of the same. I believe what I'm actually attached to (both emotionally and financially) is the stability of the old system. As you say in a later comment, the value of the American hegemony has been in the fixed but flexible rules and the absence of any direct power politics. The market based economy and "American philosophy" has been secondary.
It's easy to forget that we used to have small skirmishes with neighboring countries constantly. My country (Denmark) had a war with Sweden every 40 years up into the 19th century.
We have to remember that a new system, possibly without America at the helm, cannot be one of power politics. We cannot let the paranoia of Trumps America dictate our politics.
consumer451 · 1h ago
That group of authoritarian believers has won the USA, and are now very focused on the EU. This is very similar to how the CCP views Taiwan. The EU and Taiwan are examples of the other possibility, and the authoritarians just can't have that.
See Musk's comments regarding German politics, the CPAC gathering in Hungary, the ownership of euronews.com, the recent creation of r/europe_sub... We need to stop being passive about all of this, or democracy will become a historical note, and not something that we all enjoy on a day-to-day basis.
We have all taken democracy for granted, like breathable air. We can no longer do that.
throw0101c · 25m ago
> That group of authoritarian believers has won the USA, and are now very focused on the EU.
See recent article "The Heritage Foundation, MAGA's missionaries, sets its sights on Europe":
I understand the sentiment, I really do. I also acknowledge that what you offer is more immediately actionable than what I have, but I really hope we can be a little more thoughtful than that.
I happen to believe that the success we've seen has been, in large part at least, due to being able to take democracy for granted. We haven't had to fight for basic rights or the privilege of survival, so we've been able to fight much more ideological fights. We have rightfully had the assumption that even as we all fight bitterly over politics, you won't send your navy to attack my ports. We were safe in our disagreements being intellectual.
I fear that while defending our stable democratic institutions we end up supplanting those very same institutions with the enemy. You cannot fight lawlessness with lawlessness, you must chose to be soft and level headed, even it feels most hobbling. Else we risk becoming Trump in the name of warding him off.
consumer451 · 1m ago
[delayed]
consumer451 · 49m ago
I am honestly not sure what I am proposing myself, exactly. However, if we read each other correctly, I think I agree with your concerns.
Might we both be touching on/dancing around the concept of the "paradox of tolerance?" [0]
As a practical example, one of the most European things in modern history was this beheading of the monarch live music video [1], which was broadcast to the world as part of the Olympic opening ceremonies in Paris. I remember seeing how uncomfortable it made the broadcasters in various countries. It was glorious. Revolution can happen, and this was a reminder.
We should never shy away from discussion of our history. I am not a huge metal fan, but this tiny part of the opening ceremonies event makes me very emotional and proud to my deepest core. I still cannot believe it happened. We should be reminding everyone of the French revolution, its non-ideal near term outcomes, and other uncomfortable European history very regularly. As you stated in your original reply, it is easy to forget how we got here.
It's so much that the G7 exempted them but more that they just set the global minimum to zero.
globalnode · 1h ago
So do the rest of the world's companies still have to pay the minimum 15 percent tax if they operate in America?
saubeidl · 2h ago
America is rapidly squandering its soft power in a foolish pursuit of short-term gains.
To pull this shit in times of a rapidly rising China and a remilitarizing EU is to accelerate the shift to multipolarism and giving up global superpower status.
pydry · 2h ago
It sure would be nice if the western world didnt have the same relationship with America that Belarus has with Russia.
saubeidl · 2h ago
We're working on building our own military to a point we won't need them anymore. This is all temporary appeasement, but they'll pay the price eventually.
pydry · 1h ago
Im afraid spending more money on American arms which require American consent to work because "daddy" demanded it doesnt really count.
saubeidl · 1h ago
ReArm Europe explicitly has a "Buy European" clause. American arms are not eligible.
pydry · 22m ago
If this were the intention we'd be building drone factories, steel forges, munitions factories and hiring troops instead of buying overpriced F-35s for which american permission to operate can be withdrawn at will and which have proven to be too fragile to be allowed to be deployed in Ukraine.
The top priority still appears to be "please daddy".
refurb · 1h ago
Europe doesn't make a lot of the arms it would need to go it alone.
saubeidl · 1h ago
Which is exactly why it's rapidly expanding its arms production. Which kind of arms are you thinking of, btw?
spwa4 · 2h ago
What's the "compromise" here?
notarobot123 · 2h ago
"Give us special treatment or we'll throw a tantrum and implement a revenge tax on foreign owned firms in the U.S."
It seems like the choice is to allow the U.S to upend some fundamental aspects of international cooperation or to pay dues to the Don.
It turns out you can get some pretty big concessions if you're willing to give up your integrity in exchange.
refurb · 2h ago
“We’re not going to hold our own corporations to the minimum. What are you going to do about it?”
spwa4 · 2h ago
Ah ok, I understand. Sigh ... yeah, after the shit Ireland pulled, I guess this is the only choice left. (Ireland signing TWO agreements to apply minimum tax one with OECD, one with the EU, with the prime minister announcing wide and far on TV how important this tax was, while telling accountants they weren't going to do it, then not doing it)
On the plus side: this is going to suck bad for Ireland, and frankly they have it coming.
So it is effectively decided then, even if probably a lot of politicians still need to wake up to it, the next move is the EU taxing payments directly when they cross EU borders, contradicting half the reason the EU exists in the first place, and probably in a system that'll make EU VAT look simple. It's going to be a disaster, but not easy to exploit ... It'll take the power to tax further away from the EU and even further into the countries' own tax departments, but of course that's exactly what's needed to stop this.
And the years it'll take to do that will mean multinationals get a few more years of minimally taxed profits.
rrnechmech · 2h ago
The "investment" on the military paying off
bitlax · 2h ago
You can just do things.
jules · 2h ago
A minimum tax is a bad idea. Taxes tend to creep up, and the main pressure against that is for companies or people to leave.
ruicraveiro · 29m ago
Leave to where to avoid a global minimum tax? To Mars?
fastball · 2h ago
That mechanism would still exist, no? Just that the entity leaving is countries from an agreement, not companies from a country.
delusional · 1h ago
> and the main pressure against that is for companies or people to leave.
Has there been any serious research in this area that supports that conclusion. My impression, which is completely uninformed I admit, is that we often talk about companies leaving due to high tax burdens, but that it rarely happens. It's a politically signal, more than a factual systemic driver.
Sure, a bunch of companies have relocated to tax havens, but we're not going to solve that by regressing to a 2% universal tax rate.
thrance · 1h ago
> Taxes tend to creep up
Citation needed, corporate taxes have been going down for decades.
> companies or people to leave.
"We can't ever tax anyone because else they would just leave; ergo nothing can or should be done about rampant inequality" is not only false, it is extremely dangerous and accelerates the fall of our democracies.
mattmaroon · 1h ago
Also, the whole point of the agreement is that the tax is global so there’s nowhere to leave to.
watwut · 1h ago
Oh please, as far as USA goes, taxes went down especially for companies and rich. And the country is in the process of creating new massive deficit just by a massive tax cut.
eptcyka · 3h ago
Pathetic.
FirmwareBurner · 3h ago
US is the only G7 member with stealth B2 Spirit bombers and GBU-57 bunker busters and the will to use them. What else are they gonna do if not give in to the mobster shaking them down? Countries will only be able to stand up to US bullying when they'll overtake, or at least match the US militarily.
cenamus · 3h ago
The GBU-57 is a modern tallboy, stop acting as if it's some sort of magic superbomb. The British dropped the Grand Slam over Germany in the fourties. And that one also penetrated 40m of earth
earnestinger · 3h ago
I think you are missing the forest for the trees.
tux3 · 2h ago
Europe had been enjoying decades of peace, but it is now waking up.
However there is no sense in which Western Europe is under a credible military threat by the US.
If you look at the French nuclear doctrine for instance, it is designed to make sure people do not forget we can both go MAD.
The French nuclear warning shot is designed as a reminder, it is a nuclear EMP payload shot away from populated areas, and intended as a cease and desist, without lasting damage.
palmfacehn · 1h ago
Yes, the US has a higher defense budget and a larger individual economy. The entire premise of cartelizing "minimum taxation" levels seems more like anti-competitive bullying.
For example you can check Amazon effective tax rate here
https://csimarket.com/stocks/singleProfitabilityRatiosy.php?...
...or "Jeff Bezos did not get rich by paying taxes"
> With just 13 days until the Trump-imposed deadline to conclude a EU-U.S. deal, European Commission President Ursula von der Leyen decided the time for conventional negotiating tactics was over.
> She floated the idea that the EU’s 27 countries could join forces with 12 members of the Asian-led Comprehensive and Progressive Agreement for Trans-Pacific Partnership bloc (CPTPP) — which now includes the U.K. — to form a new world trade initiative.
> The new grouping would redesign a rules-based global trading order, reforming or perhaps even replacing the now largely defunct World Trade Organization, she said.
> Crucially, the U.S. would not automatically be invited.
https://www.politico.eu/article/eu-leaders-donald-trump-us-t...
The US is locking itself out of world trade with their behavior. The price to pay for actions like these will far outweigh any benefits.
I chuckled at first, but as a beneficiary of Pax Americana, this is a really sad state of affairs. However, I am really pro-EU, and I hope that we are up to the task coming forth.
I support this 100%, and have said nearly these exact words in the past. However, the concept of Pax __ applies to the entire "world." Even the USA's supposed enemies benefited from the rules based global order, a lot of the time. If Pax Europa is to be a thing, it needs to have effects beyond Europe's borders. The democratic European way, surviving and thriving, is the last hope for a bright near-term future for all of humanity. I truly believe this.
note: I edited my gp comment prior to seeing your response.
We can aim for the same regional scope again. I don't think all conflicts around the world should be our business.
I need to set my profile's delay number higher to allow for more comment editing time.
Conflicts in Asia shouldn't be our problem, as an example. We should stop the US from dragging us into quagmires in the Middle East, etc etc.
What matters is that we have peace at home and the strength to preserve it. The rest shouldn't be up to us.
What happens when imperialism spreads near our borders, but not yet across them? Do we wait until the final moment to mobilize? That seems like horrible planning.
In the period between WW II and Iraq II, the USA used soft and military power to keep basic world order (country borders) and commerce running. It was the enforcer of the post-war Rules Based Order.
This was a good thing, that I believe we all took for granted. Even the USA has now taken that for granted. That historical period is now officially over.
What/who will fill that void of global stability?
I've felt some of the same. I believe what I'm actually attached to (both emotionally and financially) is the stability of the old system. As you say in a later comment, the value of the American hegemony has been in the fixed but flexible rules and the absence of any direct power politics. The market based economy and "American philosophy" has been secondary.
It's easy to forget that we used to have small skirmishes with neighboring countries constantly. My country (Denmark) had a war with Sweden every 40 years up into the 19th century.
We have to remember that a new system, possibly without America at the helm, cannot be one of power politics. We cannot let the paranoia of Trumps America dictate our politics.
See Musk's comments regarding German politics, the CPAC gathering in Hungary, the ownership of euronews.com, the recent creation of r/europe_sub... We need to stop being passive about all of this, or democracy will become a historical note, and not something that we all enjoy on a day-to-day basis.
We have all taken democracy for granted, like breathable air. We can no longer do that.
See recent article "The Heritage Foundation, MAGA's missionaries, sets its sights on Europe":
* https://www.lemonde.fr/en/m-le-mag/article/2025/06/22/the-he...
MAGA got a lot of inspiration for Orban and Hungary:
* "Make America Hungary Again":* https://www.theatlantic.com/international/archive/2024/07/wh...
* "Why Conservatives Around the World Have Hungary's Orbán": https://www.newyorker.com/news/q-and-a/why-conservatives-aro...
I happen to believe that the success we've seen has been, in large part at least, due to being able to take democracy for granted. We haven't had to fight for basic rights or the privilege of survival, so we've been able to fight much more ideological fights. We have rightfully had the assumption that even as we all fight bitterly over politics, you won't send your navy to attack my ports. We were safe in our disagreements being intellectual.
I fear that while defending our stable democratic institutions we end up supplanting those very same institutions with the enemy. You cannot fight lawlessness with lawlessness, you must chose to be soft and level headed, even it feels most hobbling. Else we risk becoming Trump in the name of warding him off.
Might we both be touching on/dancing around the concept of the "paradox of tolerance?" [0]
As a practical example, one of the most European things in modern history was this beheading of the monarch live music video [1], which was broadcast to the world as part of the Olympic opening ceremonies in Paris. I remember seeing how uncomfortable it made the broadcasters in various countries. It was glorious. Revolution can happen, and this was a reminder.
We should never shy away from discussion of our history. I am not a huge metal fan, but this tiny part of the opening ceremonies event makes me very emotional and proud to my deepest core. I still cannot believe it happened. We should be reminding everyone of the French revolution, its non-ideal near term outcomes, and other uncomfortable European history very regularly. As you stated in your original reply, it is easy to forget how we got here.
[0] https://en.wikipedia.org/wiki/Paradox_of_tolerance
[1] https://www.youtube.com/watch?v=5hTMYk7orHw
To pull this shit in times of a rapidly rising China and a remilitarizing EU is to accelerate the shift to multipolarism and giving up global superpower status.
The top priority still appears to be "please daddy".
It seems like the choice is to allow the U.S to upend some fundamental aspects of international cooperation or to pay dues to the Don.
It turns out you can get some pretty big concessions if you're willing to give up your integrity in exchange.
On the plus side: this is going to suck bad for Ireland, and frankly they have it coming.
So it is effectively decided then, even if probably a lot of politicians still need to wake up to it, the next move is the EU taxing payments directly when they cross EU borders, contradicting half the reason the EU exists in the first place, and probably in a system that'll make EU VAT look simple. It's going to be a disaster, but not easy to exploit ... It'll take the power to tax further away from the EU and even further into the countries' own tax departments, but of course that's exactly what's needed to stop this.
And the years it'll take to do that will mean multinationals get a few more years of minimally taxed profits.
Has there been any serious research in this area that supports that conclusion. My impression, which is completely uninformed I admit, is that we often talk about companies leaving due to high tax burdens, but that it rarely happens. It's a politically signal, more than a factual systemic driver.
Sure, a bunch of companies have relocated to tax havens, but we're not going to solve that by regressing to a 2% universal tax rate.
Citation needed, corporate taxes have been going down for decades.
> companies or people to leave.
"We can't ever tax anyone because else they would just leave; ergo nothing can or should be done about rampant inequality" is not only false, it is extremely dangerous and accelerates the fall of our democracies.
However there is no sense in which Western Europe is under a credible military threat by the US.
If you look at the French nuclear doctrine for instance, it is designed to make sure people do not forget we can both go MAD.
The French nuclear warning shot is designed as a reminder, it is a nuclear EMP payload shot away from populated areas, and intended as a cease and desist, without lasting damage.