US’s ‘Side-by-Side’ Deal on Global Tax Faces Arduous Road Ahead

The US demand for its tax system to sit “side-by-side” with the global minimum tax framework faces a long path forward, filled with technical and political roadblocks.

Last weekend’s announcement of an “understanding” among Group of Seven countries that US companies wouldn’t be subject to key aspects of the minimum tax—Pillar Two of a global tax deal—is only the first step to reaching an agreement with the US, foreign governments and observers say.

“The G7 statement represents an understanding among seven countries about a proposed way forward for a side-by-side minimum tax system. That proposal, as explicitly contemplated in the ...