The United States and the Group of Seven nations have agreed on a plan to exempt U.S. companies from parts of a major global tax deal, a move set to reshape international tax stability.

The agreement, announced on Saturday from Canada, follows Washington’s decision to remove Section 899, a controversial retaliatory tax included in President Donald Trump’s tax and spending bill.

Under the new "side-by-side" system, U.S. firms escape some burdens of the 2021 global corporate minimum tax deal, which had been brokered under the Biden administration with nearly 140 countries. Trump, however, withdrew from it in January through an executive order, arguing that the U.S. should not be bound by it.

Britain hailed the new agreement as a victory for business certainty. UK finance minister Rachel Reeves said companies would benefit from stability after concerns about steep tax increases. She also stressed the ongoing need to combat aggressive tax avoidance.

Section 899 had alarmed British and other European businesses, who feared extra costs if retaliatory taxes took effect on U.S. soil.

The G7 said the new plan acknowledges existing U.S. minimum tax laws and aims to reduce global tax conflicts. Officials called for further talks to find a solution "acceptable and implementable to all."

Trump had threatened a retaliatory tax on countries taxing U.S. firms under the global deal, a move seen as harmful to many foreign businesses operating in America.

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