Business Groups Push Back Against GOP’s Foreign Company Tax Proposal

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Republican Tax Plan Aims at Foreign Firms Amid Global Tensions

Business lobbyists are mounting a fierce campaign against a new Republican-backed tax proposal that targets foreign companies operating in the United States. The measure, dubbed a “revenge tax,” is part of broader domestic policy legislation recently introduced by Senate Republicans. It would penalise companies based in nations that either enforce the 2021 global minimum tax deal or levy digital services taxes that primarily affect American tech giants.

Last month, House Republicans passed a version of the bill that would trigger the tax immediately. However, responding to concerns from the business community, the Senate’s version delays its implementation until 2027 and sets a lower maximum tax increase — capping it at 15 percentage points rather than the House’s 20. Despite the delay, many expect the provision will ultimately become law, posing significant risks for foreign investment in the U.S.

Business Leaders Warn of Economic Fallout

According to congressional estimates, the measure could generate over $100 billion in revenue over the next decade. Yet critics argue that it could discourage foreign investment precisely when the Trump administration is seeking to attract more international capital to the U.S. economy.

“This measure directly contradicts the president’s investment vision,” said Jonathan Samford, CEO of the Global Business Alliance, which represents multinational companies with U.S. operations. Samford’s group estimates the tax could cost the U.S. 700,000 jobs and reduce GDP by $100 billion annually. Companies such as Unilever, L’Oréal USA, and Michelin have joined the lobbying effort, sending over 70 executives to Washington to voice their concerns.

Analysts warn that the proposed tax could spark renewed international trade and tax conflicts, with the issue likely to feature prominently at the upcoming Group of 7 summit in Canada. “It’s right for people to be nervous,” said James Lucier of Capital Alpha Partners, noting heightened market jitters as U.S. debt levels rise.

While critics acknowledge the need to address foreign countries’ discriminatory taxes on American firms, they argue that the Republican proposal risks severe unintended consequences for both the U.S. economy and global financial stability.