Congress should think again about foreign investor tax: UK ambassador to US

British Ambassador to the U.S. Peter Mandelson is appealing to Congress to think again about the proposed new retaliatory tax on certain foreign investment in the US.

"I think that there's something wrong in principle that you should punish a country's businesses and individuals in America because you don't like what their governments are doing at home," Mandelson said of Section 899 of the House's "big, beautiful bill" to implement Trump's agenda.

Section 899 would create a retaliatory tax on nationals of countries that impose “unfair foreign taxes” on American businesses.

"If you've got an argument with their governments, then take it out on the governments. Don't take it out on the businesses and the individuals," he added.

Mandelson also believes that this new foreign investor tax is "counterproductive" for the United States.

"If you're creating such a risk or potential uncertainty tax on businesses here, then many will think twice about investing further in the United States. I would ask Congress to think again about 899," he said.

According to Mandelson, both Congress and the Trump administration should resolve these matters by negotiation, and "not by means of a legislative bludgeon", where he says the "innocent are being punished because it's felt that revenge is due against a country and it's taken out on businesses and individuals here in the US."

He added that Section 899 also sets a "very difficult precedent," and it's better resolved by "government to government negotiation and by discretionary means, not statutory ones."

The provision has stoked concerns on Wall Street over whether foreign investors would pull out of U.S. investments over fears of retribution from Trump.