US Senators Elizabeth Warren (D-MA), Angus King (I-ME), Michael Bennett (D-CO.), and Representative Don Beyer (D-VA) are urging to fully implement the 15% Corporate Alternative Minimum Tax (CAMT). A  signed letter was sent to Treasury Secretary Janet Yellen on 2 July, 2024,

In 2022, President Biden enacted the CAMT as part of the Inflation Reduction Act.

The letter reads:

Dear Secretary Yellen,

We are writing to urge you to continue your efforts to fully implement the 15% Corporate Alternative Minimum Tax (CAMT) that Congress passed and President Biden signed into law with the passage of the Inflation Reduction Act.

The CAMT is the first corporate tax increase in 30 years, poised to raise over USD 220 billion from billion-dollar corporations over the next decade, and – as of March 2024 – over a dozen big corporations have voluntarily disclosed that they would be paying the tax based on their 2023 earnings. However, the Treasury Department has a critical role to play in the implementation of the CAMT and must roll out strong and timely rules to ensure giant corporations begin paying their fair share.

For decades, corporations have exploited the loophole-riddled tax code to avoid paying taxes, shortchanging the government billions of dollars and imposing unfair fiscal burdens on the middle class. Most recently, the 2017 Trump tax bill slashed the corporate income tax rate from 35% to 21% and created new corporate loopholes, resulting in corporations paying a significantly reduced amount of income tax, or paying nothing at all. In the five years following the Trump tax cuts, 55 of the biggest corporations reported nearly USD 670 billion in profits to their shareholders but paid less than 5% of those profits in taxes.

The CAMT represents a historic step to address corporate tax evaders, requiring that when companies report over USD 1 billion in profits to their shareholders, they must pay at least 15% of those profits in taxes. This is a signature accomplishment of Congressional Democrats and President Biden, raising USD 222 billion to fund critical investments in clean energy jobs and technology to combat climate change. Moreover, the President has made strengthening the CAMT a key part of his FY2025 Budget, proposing an increased rate of 21%, which would raise an additional USD 137 billion.

But in order to fully realise the gains from the CAMT, the Treasury Department and Internal Revenue Service (IRS) must act quickly to issue key rules. These rules are needed to address some of the complexities within the tax provision and proactively thwart off corporation-led efforts to frustrate the intent of the law. To date, the Treasury Department and IRS have issued some preliminary guidance on how to calculate a corporations’ “adjusted financial statement income”, (AFSI) and what factors should be considered in doing so.

You have also received thoughtful comments from experts suggesting key guardrails and clarifications related to the rules for determining AFSI. However, Treasury and the IRS have yet to release the proposed regulations that will resolve some of the outstanding considerations, having previously indicated that rules would be released in early 2024.

We appreciate your thoughtful work to implement this historic corporate tax legislation. We urge you to quickly issue strong regulations to implement the corporate minimum tax to ensure that the largest corporations begin to pay their fair share and respectfully request that you promptly brief our staff on the status of your work.