There are still pressure points on the agenda, however. The United States has scuffled with European countries in recent years over how much tax they collect from American companies. Just this month, Italy settled with Google for $334 million over back taxes. Airbnb recently began collecting tourist taxes from customers in France after pressure from authorities. And Apple paid Italy about $350 million in back taxes a few years ago and remains locked in a court battle with the E.U. over a tax bill of more than $13 billion.
Since 2012, advanced economies have been working to coordinate their tax codes to combat companies that advantage of loopholes in the international system. The United States is one of the only countries in the world that taxes corporate income wherever it is earned. Treasury Secretary Steven Mnuchin has expressed support for moving to a territorial system that only taxes domestic income. The Trump administration has also floated massive structural changes, including broad deregulation and a trillion-dollar package of new government spending on infrastructure.
Exactly how much the White House is able to accomplish could help set the trajectory for growth not just in the United States, but the rest of the world.
“Until they have a good fix on what the United States is going to do … it’s tough for the other G7 economies to get a sense of what they should do to make the overall package work for all,” said John Kirton, co-founder of the G20 Research Group and a research associate at the University of Toronto.
Mnuchin may not be able to completely avoid questions about trade, however. The topic is likely to come up during formal one-on-one meetings between finance ministers or during the more informal chats on the sidelines of the conference. Officials may also raise the issue during sessions on boosting economic growth.
“Does America First mean that America in this administration is going to turn really inward?” said Tony Fratto, managing partner at Hamilton Place Strategies. “Or is it beginning to see that it’s in America’s interest to be leaders in these global cooperation meetings?”
