The Socialists and Democrats have sent a letter to European Commissioner Wopke Hoekstra demanding clarification of the economic losses resulting from a harmful deal brokered with US President Donald Trump in January, which exempts American multinationals from crucial parts of the landmark global agreement on a minimum effective corporate tax rate of 15%, agreed in 2021*.
The global tax deal was intended to curb global tax competition and was expected to generate €64 billion annually in additional tax revenues for the EU. However, under the revised framework agreed at the G20/OECD Inclusive Framework, US multinationals will no longer be bound by minimum taxation rules under the original agreement. The Group is therefore calling for a transparent evaluation of the estimated revenue losses for EU countries – and ultimately for European taxpayers.
As the S&D letter has been sent to Commissioner Hoekstra, the EU’s role in shaping fairer taxation in a rapidly changing economy is being discussed at the EU Tax Symposium 2026, taking place at the beginning of this week in Brussels. The debate is also focusing on another key tax issue: digital taxation.
The S&D Group has repeatedly condemned the continued efforts by the Trump administration to undermine EU tax and digital sovereignty, calling for urgent EU action on fair corporate taxation, including for digital companies. This is necessary to break with the current system, which allows tech giants to avoid paying their fair share.
Bruno Gonçalves, S&D spokesperson on taxation, said:
“Despite the major significance of the safe harbours established by the OECD/G20 side-by-side agreement, there are, unfortunately, no published studies or estimates of its economic impact. The S&D Group therefore calls on Commissioner Hoekstra to provide a transparent assessment of its impact on EU member states and to release any available data or analysis on the estimated revenue losses for EU countries.
“The agreement risks distorting the concept of a global minimum corporate tax, while introducing a lopsided advantage to US-based companies by partially shielding profits booked in tax havens. It is equally crucial to understand this framework's implications on the level playing field, especially if leading to a significant corporate relocation of headquarters and/or investments. The Commissioner should also monitor this closely and assess whether rebalancing is required.”
Jonás Fernández, S&D spokesperson on economic and monetary affairs, added:
“The OECD/G20 parallel tax agreement represents a significant rollback. We are extremely concerned about its effects. It could reignite the harmful corporate tax practices that the original global deal was designed to curb. The global minimum tax framework is a cornerstone of international tax cooperation, and its successful implementation is vital for ensuring fair taxation, protecting public revenues, and supporting sustainable economic growth.
“The January deal is yet another reminder that Europe must be ready to move forward with alternative solutions that guarantee fair taxation, particularly in the digital economy. The EU must not abandon its commitment to tax justice, which is essential for tackling inequality and restoring citizens’ trust. Europe must lead the way where global progress has stalled.”
*Note to editors:
In October 2021, 137 countries reached a landmark deal to introduce a minimum effective corporate tax rate of 15%, which for the first time curbs global tax competition. This agreement, concluded under the OECD/G20 Inclusive Framework, needed to be translated into European law and into the legislative frameworks of all other signatories. The EU adopted legislation implementing the global agreement in December 2022.
In July 2025, the G7 agreed with US President Donald Trump to exempt US multinationals from the historic global minimum tax deal. The S&D Group deplored this move as a betrayal of tax justice and demanded clarifications from Commissioner Hoekstra. This deal was nevertheless formalised in January through the OECD/G20 agreement on a “side-by-side” package of measures – a set of parallel rules operating alongside the original deal.
