PILLAR 2 | US MNEs exempt from Pillar 2 Taxes according to G7 Tax Deal

The global minimum tax is an irritant for the US government. Already on his second day in office, US President Trump announced that the US would explore options for “Protection against Discriminatory and Extraterritorial Tax” at the expense of US companies. The “One Big Beautiful Bill Act” (OBBBA) sought to introduce a reciprocity-based tax mechanism in Section 899 of the Internal Revenue Code (IRC), which would have led to an increased tax burden for foreign taxpayers resident in Pillar 2 compliant countries. On June 28, 2025, the G7 announced a deal: The US will refrain from implementing Section 899 IRC, in return for being exempted from global minimum tax rules.