Nearly 150 countries agreed to update a major global minimum corporate tax framework, but U.S.-based multinational companies will be exempt from the 15 per cent global minimum tax under the revised arrangement. This carve-out was secured through negotiations involving the United States and other Group of Seven nations and significantly alters how the global tax deal will affect large American corporations.

The original agreement, negotiated under the Organisation for Economic Co-operation and Development (OECD), was designed to ensure that large multinational firms pay a minimum tax rate wherever they generate profits. It was intended to reduce incentives for profit shifting to low-tax jurisdictions — such as Bermuda, the Cayman Islands, or other tax havens — where companies book income despite limited substantive operations. However, the updated deal excludes U.S. firms from this requirement if they are already subject to domestic minimum tax provisions set by U.S. law.

U.S. officials argued that the exemption protects U.S. tax sovereignty and competitiveness, noting that American tax law already includes mechanisms aimed at ensuring a baseline tax on multinational earnings. Under the revised framework, U.S. companies would instead continue under their existing domestic minimum tax regime without being subject to additional foreign top-up taxes from other jurisdictions under the global deal. This side-by-side arrangement was framed by U.S. negotiators as a way to balance international cooperation with the need to avoid double taxation and undue external constraints on American multinational operations.

Supporters of the exemption, including U.S. political leaders and representatives, described the outcome as a win for national economic interests and a safeguard against policies that could disadvantage U.S. firms abroad. They argued that forcing American multinationals to adhere to both U.S. tax rules and additional foreign minimum taxes could distort investment decisions or reduce global competitiveness.

Critics of the revised agreement say this carve-out could undermine international efforts to curb tax avoidance and weaken the effectiveness of global tax cooperation. They note that exempting the largest multinational companies from the minimum tax framework could allow continued use of tax avoidance strategies, particularly for profits booked in low-tax jurisdictions. Some tax-transparency advocates argue that the exemption could dilute nearly a decade of progress toward more equitable corporate taxation.

In summary, the revised global tax deal retains the 15 per cent minimum tax for many countries but explicitly excludes U.S.-based multinational corporations, shaping how international tax rules will apply and marking a significant shift in the global corporate tax landscape.