Minimum Taxation in the United States in the Context of GloBE

5 Pages Posted: 27 Apr 2022 Last revised: 6 Oct 2022

See all articles by Reuven S. Avi-Yonah

Reuven S. Avi-Yonah

University of Michigan Law School

Mohanad Salaimi

University of Michigan Law School - Law Student

Date Written: April 17, 2022


The introduction of the minimum tax in Pillar II of the OECD/G20/IF framework was generally seen as a response to the U.S. Tax Cuts and Jobs Act (TCJA) of 2017. The TCJA included both a minimum tax on outbound income (the Global Intangible Low-Taxed Income, or “GILTI”) and a minimum tax on inbound income (the Base Erosion Anti-Avoidance Tax, or “BEAT”). These were seen as the precursors to the IIR and the UTPR. Thus, unlike Pillar I which was perceived as a device to impose more tax on the U.S. digital giants, Pillar II was seen as more consistent with U.S. tax policy.

This story is true to some extent, but the relationship between the U.S. and Pillar II is more complicated. Pillar II was the culmination of years of efforts to implement the single tax principle (STP), which has its origins in the 1920s but was not the guiding principle of U.S. tax policy for a long period before the TCJA. Moreover, the TCJA does not fully implement Pillar II, and it is unclear whether the U.S. can in fact do so.

In what follows, we will first discuss the relationship between the TCJA and Pillar II, then the possible U.S. responses to Pillar II, and finally what would happen if the U.S. does not implement Pillar II. In general, if Pillar II is not implemented in the U.S., the tax consequences are likely to be increased double taxation as well as a shift in revenues from the U.S. to foreign jurisdictions.

Keywords: Globe, pillar 2, TCJA

JEL Classification: H26

Suggested Citation

Avi-Yonah, Reuven S. and Salaimi, Mohanad, Minimum Taxation in the United States in the Context of GloBE (April 17, 2022). U of Michigan Public Law Research Paper No. 22-041, Available at SSRN: or

Reuven S. Avi-Yonah (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4033 (Phone)

Mohanad Salaimi

University of Michigan Law School - Law Student ( email )

Ann Arbor, MI
United States

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