Congress moves to erase corporate minimum tax, cutting federal revenue
S. 796 — Book Minimum Tax Repeal Act · Filed by John Barrasso (R-WY) · 8 cosponsors · Introduced Feb 27, 2025 · Referred to committee
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What it does
This bill repeals the corporate alternative minimum tax (CAMT), a 15% tax enacted in 2022 that required large corporations to pay a minimum tax on their book income (accounting profits) regardless of tax deductions. The repeal would eliminate this requirement, allowing corporations to reduce their tax bills through existing deductions and credits, with the change effective for tax years beginning after December 31, 2024.
Why we flagged it
The bill's sole function is to eliminate a corporate minimum tax enacted in 2022, directly reducing tax obligations for large corporations. This is a straightforward, if narrow, tax cut for a specific class of taxpayer.
What the text implies
- Repealing CAMT may incentivize aggressive tax-avoidance strategies by corporations, as the floor preventing extreme deduction stacking is removed.
- The change is retroactively effective to January 1, 2025, potentially allowing corporations to claim refunds for taxes already paid under CAMT in early 2025.
The full analysis lists 4 implications of this text.
Who stands to gain
large corporations with high book income but low taxable income; corporations with significant deductions and tax credits; multinational corporations using transfer pricing and other strategies