(Global Tax Deal, in Bed with Mrs Market, Part 3)
by A. Irmanputra Sidin, PhD in Constitutional Law/ Constitutional Lawyer
Jakarta, February 9, 2025
The Trump’s memorandum about Global Tax Deal recaptures Nation’s sovereignty and economic competitiveness by clarifying that the Global Tax Deal has no force or effect in the United States. there are two instructions of Mr President:
Section 1 declared that Applicability of the Global Tax Deal have no force or effect within the United States absent an act by the Congress adopting the relevant provisions of the Global Tax Deal.
Sec. 2 instruction to the The Secretary of the Treasury in consultation with the United States Trade Representative shall investigate whether any foreign countries are not in compliance with any tax treaty with the United States or have any tax rules in place, or are likely to put tax rules in place, that are extraterritorial or disproportionately affect American companies, and develop and present to the President…[1]
Why do Mr President emphasized that any commitments made by the prior administration on behalf of the United States with respect to the Global Tax Deal have no force or effect within the United States absent an act by the Congress adopting the relevant provisions of the Global Tax Deal.
We could understand that is emphasized because most countries in the world in their constitution declared that all international deal between government to other government with other countries must get advice and consent by the parliament before entry into force or took constitutionally binding to the people in their countries (Article 2 Sec 2 US Constitution).
In UUD 1945 as an Indonesian Constitution as a comparison of articles with US Constitution we would find Article 11 that the President with the approval of People’s Representative Council concludes treaties with other countries and when concluding other international treaties that give rise to extensive and fundamental consequences to the life of the people related to the financial burden of the state, and/or compelling amendment or enactment of laws shall be with the approval of the People’s Representative Council.
This constitutional rules has made, members of the House, House Speaker Mike Johnson, House Majority Leader Steve Scalise, House Majority Whip Tom Emmer, House Republican Conference Chair Elise Stefanik , and Ways and Means Committee Chairman Jason Smith along with every Ways and Means Republican warn in a letter to OECD[2] :
“….Implementation of the UTPR and other OECD policies would force the United States to forfeit $120 billion in revenue to foreign governments while offering competitive advantages to China and others,”write House Republican Leadership and Ways and Means Republicans. “Ultimately, the Biden-Harris administration lacks the authority to impose any tax deal on Americans without the approval of the U.S. Congress – doing so would violate the United States Constitution…The United States Constitution expressly grants the taxing power to Congress, not to the President. Specifically, the U.S. Constitution requires that ‘[a]ll bills for raising revenue shall originate in the House of Representatives.’ This constitutional structure makes the Committee on Ways and Means, the tax-writing committee in the U.S. House of Representatives, the only entity where changes in U.S. tax law may originate. Thus, the Biden-Harris administration’s unilateral negotiations without consultation with Congress constitutes a major overstep of its authority, with dire consequences for American workers and businesses.”
Not only that, Mr President also emphasized in the memorandum that the Secretary of the Treasury shall investigate whether any foreign countries are not in compliance with any tax treaty with the United States or have any tax rules in place, or are likely to put tax rules in place, that are extraterritorial or disproportionately affect American companies, and develop and present to the President,
If we take a deeper look the messages of this memorandum, we could understand why, Mrs Market always should get closer with Mr President, because Mrs Market is not only protected by Mr President, but also, to prevent earning from Mrs Market businesses absorbed by foreign countries by global tax regime over the foreign businesses. Without impose the global tax deal of OECD, the earning before tax could recapture by the US businesses because its would not forfeit and and then will increase net profit, and that may reutilized to serve the interests of the businesses, workers and for people of the country. This is not just principle embraced by US but almost the businesses in the countries and all countries across the globe.
All countries in the world have resemblance interest over its internal businesses in their countries, that is why, the countries should cooperate to make deal between others how to respect each other’s sovereign territories. We know that the market right now no limit border again, moreover technology, growing very fast, digital economy and globalized market, is a universe even metaverse. Notwithstanding, the countries would use their power, to gain in the market, of course for utilized for the welfare of their people and their interest as a sovereign countries.
No exception, Mr President has used their constitutional power to protect their businesses and workers according the constitution to declare that the Global Tax Deal has no force or effect in the United States.
To be continue..
Next
*Featured Photo : Jusoor Post*
[1] https://www.whitehouse.gov/presidential-actions/2025/01/the-organization-for-economic-co-operation-and-development-oecd-global-tax-deal-global-tax-deal/
[2] 18 September 2024, Biden-Harris Administration Forfeiting U.S. Sovereignty in Global Tax Deal is an Unconstitutional Giveaway to China https://waysandmeans.house.gov
