European Finance Chiefs Hit Out at U.S. Tax Plans

the BDI Federation of German Industry, Germany’s most influential business lobby, warned some provisions of the bills ostensibly aimed at curbing corporate tax avoidance had “clearly a protectionist character.”

.. The ministers took specific issue with provisions in both the House and Senate versions of the tax bill, including proposed excise-tax payments to foreign-affiliated firms in the House version. They also cited a “base erosion” provision in the Senate version that would add tax to cross-border financial transactions.

 .. Mr. Liguori said software makers like SAP SE, based in Germany, could also get hit.

.. the reform would leave U.S. businesses facing lower domestic-tax rates than some of their European peers, putting governments under pressure to reciprocate.

.. For years, European governments and the U.S. have sought to combat beggar-thy-neighbor corporate tax policies
.. A provision of the House bill for a 20% excise tax on payments to foreign-affiliated companies, the Europeans warned, would discriminate against non-U.S. businesses operating in the country, contravene World Trade Organization rules and breach double-taxation agreements.
.. the proposed “base erosion and anti-abuse tax provision” contained in the Senate bill could harm international banking and insurance businesses because it would treat cross-border financial transactions between a company and a subsidiary as nondeductible, subjecting it to a 10% tax,