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yesterday

Republicans Remove Section 899 ‘Revenge Tax’ From Trump’s Tax and Spending Bill

Treasury Secretary Scott Bessent credited a G7-backed OECD tax accord for the repeal, leaving lawmakers to fill a $52 billion revenue gap before the July 4 deadline.

Treasury Secretary Scott Bessent talks to reporters about his lunch meeting with Republican senators and the schedule for getting the Republican megabill to President Donald Trump's desk by July 4, at the Capitol in Washington, Tuesday, June 24, 2025. (AP Photo/J. Scott Applewhite)
U.S. Treasury Secretary Scott Bessent arrives to attend the G7 Leaders' Summit at the Rocky Mountain resort town of Kananaskis, Alberta, Canada, June 15, 2025. REUTERS/Chris Helgren/Pool/File Photo
Treasury Secretary Scott Bessent at a Cabinet meeting at the White House on April 10, 2025.
A man walk past the G7 members flags at the Manoir Richelieu before the G7 Foreign Ministers summit in La Malbaie, Que., in March.

Overview

  • House Ways and Means Chair Jason Smith and Senate Finance Chair Mike Crapo agreed on June 27 to strip Section 899 after Bessent’s request under the OECD Global Tax Deal.
  • Section 899 would have allowed punitive taxes on foreign investors from countries with digital services taxes or OECD Pillar 2 minimum tax rules and was projected to raise $52.2 billion over ten years.
  • Bessent said the G7-endorsed agreement will enhance global economic stability and boost U.S. investment, a view echoed by Canada’s Finance Minister François-Philippe Champagne.
  • The repeal creates a significant revenue shortfall in the One Big, Beautiful Bill, prompting Republicans to seek alternative offsets and reconsider other funding measures.
  • Senate parliamentary rulings against key Medicaid provider tax changes add to the procedural hurdles as lawmakers race to meet the president’s July 4 enactment goal.