More than 200 accounting and tax experts, including at least two former U.S. accounting-standards officials, have asked federal lawmakers not to tie a proposed minimum corporate tax to income measures reported to investors.
Under the proposal, companies reporting at least $1 billion in pretax book income would have to pay a minimum tax of 15% of that figure, adjusted for a variety of deductions and tax credits. Book income is the amount of income companies publicly report on their financial statements to shareholders.
The plan is one of a number of corporate tax provisions intended to help pay for the Biden administration’s $1.85 trillion in proposed spending on healthcare, education and climate-change initiatives.
The proposal risks politicizing accounting rules, encouraging companies to distort their financial results, and unnecessarily