President Donald Trump sent a memorandum to the incoming Secretary of the Treasury announcing the end of the Global Tax initiative established under the Biden Administration. There are many reasons why the Global Tax was a bad deal to begin with, and Trump’s action is great for America.
Supported by former Secretary of the Treasury Janet Yellen, who holds a PhD in economics, and embraced, at least verbally, by other countries (around 130), the Global Tax was idiotic from day one.
It is astounding that Yellen, a former Fed Chair, aggressively pursued the policy that would have undermined America’s ability to compete while putting our advisories at an advantage.
In brief, one of the ways countries compete is by offering more advantageous tax regimes. Low-tax countries, especially ones with good infrastructure, rule of law, and plenty of capital, can persuade companies to invest, driving economic growth and prosperity. To eliminate this key competitive advantage is absurd. Why would the US want to erase a key component to attracting investors?
Additionally, taxes are complex. All governments take from one hand and give to another. A tax bill can be easily manipulated with policies and subsidies that eliminate any burden. It happens all of the time. It also happens in the US. A Global Tax would be an utter failure from day one.
And do you believe for one second that our biggest adversaries would actually relinquish control of this critical aspect of economic sovereignty to a global cabal? Absolutely not.
While some described the Global Tax as a fairer system, the reality would have been very, very different. But there will always be people who believe in unicorns living in Xanadu, frequently wrong but never in doubt – but these are not the ones who should be guiding tax law.
