Comparing Biden and Wyden international tax proposals (KPMG chart)

Comparing Biden and Wyden international tax proposals

Tax proposals from President Joe Biden and Senate Finance Committee Chairman Ron Wyden (D-OR) would make substantial changes to the U.S. corporate tax system—in particular, major changes to the international tax system that would reverse certain rules included in the 2017 tax law (the law that is frequently referred to as the “Tax Cuts and Jobs Act”).


Related content

President Biden and Chairman Wyden are broadly proposing to move in the same direction—increasing the U.S. corporate rate while simultaneously raising taxes on foreign earnings. But there are important differences between Biden’s proposals and those outlined by Chairman Wyden.

KPMG on Friday April 16, 2021, presented a webcast during which details of the proposals were explored. Watch a replay of the webcast

In relation to the webcast, KPMG provided the following chart of the Biden Administration and Wyden proposals.



Biden Administration Proposal1

Wyden Proposal2

General corporate

Corporate rate and minimum tax

  • Increase corporate to 28%
  • New minimum tax of up to 15% of book income on large corporations reporting net income of $2B or more

No proposal


GILTI rate

Increase GILTI rate from 10.5% to 21% (75% of proposed new 28% corporate tax rate)

GILTI rate increase; notes prior Democrat proposals ranging from 60 to 100% of the corporate rate


Net Deemed Tangible Income Return (“DTIR”) deduction (10% return on Qualified Business Asset Investment (“QBAI”))




Apply country-by-country computation (no details on computation)

Apply country-by-country limitation by:

  • Separate GILTI foreign tax credit (FTC) baskets for each country, or
  • Mandatory high-tax exception set at the GILTI rate—apply GILTI only to income from low-tax jurisdictions

Expense allocation 


No proposal Treat expenses for research and management in the United States as entirely domestic


Repeal FDII and replace with more R&D investment incentives

Open to retaining a revised version of FDII if the GILTI rate remains lower than corporate rate



Repeal QBAI reduction to FDII

Applicable income



Modify qualifying income to be based on a % of expenses for
U.S. R&D and job training

This “deemed innovation income” would replace “deemed intangible income” in the FDII formula, so retains focus on portion that is foreign derived



Replace with “SHIELD,” to deny deductions on payments to foreign related parties if the payment is subject to a low effective tax rate

No proposal

Treatment of credits

No proposal

  • Allow full value of domestic business tax credits to reduce BEAT liability
  • Open question on relief for FTCs; depends on BEAT revenue


Rate for defining a low-taxed payment and acceptable minimum tax regime set by multilateral agreement, but pending such agreement, at the GILTI rate

  • Retain 10% rate for “regular” taxable income
  • Increase rate for addbacks for deductible payments




Corporate residency

Treat a foreign acquiring corporation as a domestic corporation if:

  • The foreign acquirer satisfies a 50% ownership test, or
  • The management and control is in the US

No proposal

Expense allocation and apportionment

No proposal

Treat expenses for research and management in the US as entirely domestic (i.e., exclusive apportionment)

Offshoring expenses

  • Deny deductions for job offshoring
  • Provide credit for job onshoring (previously described as 10%)

No proposal

Onshoring incentive

Provide a tax credit to support onshoring jobs

No proposal

1Read TaxNewsFlash for The American Jobs Plan, released by the White House on March 31, 2021, and TaxNewsFlash for The Made in America Tax Plan, released by the Treasury Department on April 7, 2021.   

2Read TaxNewsFlash on Overhauling International Taxation, released by Senators Ron Wyden (D-OR), Sherrod Brown (D-OH), and Mark Warner (D-VA) on April 5, 2021.  

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us


Want to do business with KPMG?


loading image Request for proposal