President Trump Issues Regulatory Freeze, Withdraws From Global Tax Agreement
Along with trade, energy, and immigration-related executive actions, last week President Donald Trump issued several orders, memos, and statements related to regulatory and tax policy.
First, as most presidents do when they take office, President Trump imposed a freeze on new and in-process regulations. This moratorium pauses any rules from the outgoing Biden administration that have been proposed but not finalized, finalized but not sent to the Federal Register, or sent to the Federal Register but not published. This executive order also recommends that federal agencies delay the effective dates of any published-but-not-yet-effective Biden rules by at least 60 days, giving the Trump administration time to decide whether to rescind or revise the rules.
President Trump also rescinded several Biden executive orders, reinstating policies that had been in place during President Trump’s first term. Perhaps most significantly, President Trump undid President Biden’s rescission of his “one-in-two-out” policy, setting the stage for more reworked and repealed regulations than new rules in his second term. The commander in chief also rescinded a Biden order that had reduced agencies’ obligations to seek public input on guidance documents, which agencies use to interpret regulations and give direction to regulated parties.
Next, President Trump pulled the United States out of the Organization for Economic Cooperation and Development (OECDO global tax deal. As explained at this link, a key feature of that deal was a provision to impose a global minimum tax of 15 percent on corporate profits, including by granting countries in certain circumstances the ability to impose a “top-up tax” on very large multinational groups to ensure that profits derived in that country are subject to the global minimum tax — even if that multinational company would not otherwise be subject to tax on those profits in that country. Read more about the OECD agreement at this link.
Finally, President Trump also established the Department of Government Efficiency, which is tasked with reducing federal spending, modernizing technology and software, and scaling back the federal government’s regulatory footprint.