At a public forum in April 2021, a Treasury official stated the United States desires to amend existing income tax treaties with Switzerland and Israel, and that the United States has opened tax treaty negotiations with Colombia, has completed tax treaty negotiations with Norway and Romania, and is engaged in ongoing tax treaty discussions with Croatia.
This treaty activity contrasts with recent US tax treaty history, where, in 2019, following a lengthy hiatus in the tax treaty approval process, four US tax treaty protocols, which had been negotiated and signed years before, entered into force.
In addition, three additional pending US income tax treaties – with Chile, Hungary, and Poland – that also were negotiated and signed several years ago, remain pending. The timing for Senate action on those treaties remains uncertain and those treaties may require further renegotiation.
It appears that updating existing treaties and expansion of the US tax treaty network may be a priority (albeit one of many) for the Biden Administration. The greater certainty afforded by tax treaties for mitigation of excessive taxation or double taxation is an area of importance to global companies doing business in the United States and can be a critical determinant for non-US companies investing in the United States.
