02 February 2018 U.S. International Tax This Week for the Week Ending February 2, 2018 Ernst & Young's U.S. International Tax This Week newsletter for the week ending February 2 is now available. Prepared by Ernst & Young's International Tax Services group, this weekly update summarizes important news, cases, and other developments in international taxation. —————————————————————————
Spotlight The US is actively considering how to address the pressing need for interpretative guidance following the enactment of the Tax Cuts and Jobs Act (TCJA). A Treasury official was recently quoted as saying that most of the necessary guidance to implement the new law will be released over the next 12 to 18 months. As far as the interaction between newly enacted provisions and the rest of the Code, "there is no chance of us [Treasury] having that completely thought out in a three-month period of time." The official said taxpayers should adopt a "reasonable methods consistently applied" approach during the period before regulations are issued. In the meantime, a Treasury official was quoted as saying the government will continue to release notices on one-off issues, like those issued under Section 965 repatriation transition tax. Other areas where coordination is required between the specific provision and the existing Code will require more than a notice; examples cited include the new Global Intangible Low Tax Income (GILTI) tax and the Base Erosion and Anti-Abuse (BEAT) minimum tax. The official said this type of guidance is more likely to come in the form of proposed regulations, but not before summer. A White House official this week reminded the public, however, that Treasury is still held to President Trump's "2 for 1" executive order issued on January 30, 2017. Executive Order 13771 generally requires agencies to remove two regulations for every new regulation that is issued. It was unclear in the months following the issuance of the Executive Order whether Treasury was subject to the rule. On the issue of technical corrections legislation, Congressional Joint Committee on Taxation (JCT) Chief of Staff Tom Barthold was quoted as saying that it is not clear when tax writers will introduce a TCJA technical corrections bill, but that the JCT is working on what it may include. He also said there is no timetable for a "Bluebook" describing enacted tax legislation. The Bluebook is traditionally published at the end of a Congress, but another JCT official confirmed an off-year edition focused solely on the TCJA is possible. The Organisation for Economic Co-operation and Development (OECD) on January 23 announced the launch of the International Compliance Assurance Programme (ICAP) pilot (see Tax Alert 2018-0204). The pilot will focus on multilateral risk assessment and resulting tax assurance of large Multinational Enterprise (MNE) groups. ICAP is a voluntary program that will use Country-by-Country (CbC) reports and other taxpayer-provided information to allow MNE groups and tax administrations to engage in open discussions on tax risks, and, if agreement can be reached that the issues are low risk, to provide outcome letters that state this. The ICAP pilot focuses on low risk taxpayers; the OECD hopes that future ICAP programs will allow taxpayers with higher risk profiles to also enter the program. Eight jurisdictions are participating in the pilot: Australia, Canada, Italy, Japan, the Netherlands, Spain, the United Kingdom and the United States. The number of MNE groups participating in this exercise is unknown, and each was invited to participate by the tax authority of the jurisdiction in which it is headquartered. |
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Upcoming Webcasts How is your digital transformation driving your deal strategy? (February 7)
The benefits of digital technology and threats from digitally enabled competitors remain a key source of sector disruption according to a recent EY study. Enabling a digital future requires smart investment strategy and capital allocation. Selecting the right approach — organic or inorganic — offers routes to growth. During this Thought Center Webcast, Ernst & Young professionals will examine the key question: should companies buy or build the capabilities required to succeed in this new environment? The outlook for global tax policy and controversy in 2018 (February 8)
The long-term trend for countries to pursue a "low-rate, broad-base" business tax strategy continues in 2018, according to EY's eighth Global tax policy outlook report. However, many countries are now responding to the twin pressures of BEPS constraints and US international tax reform by either increasing existing business incentives or introducing entirely new incentives as a way to remain competitive. During this Thought Center Webcast, EY tax policy and controversy leaders will review the report. International tax talk quarterly series: Addressing tax planning, risk and other pertinent global tax topics (February 13)
During this Thought Center Webcast, Ernst & Young professionals will discuss the non-US tax aspects and practical issues encountered in cash repatriations. The panel will highlight recent developments and tax issues in mobilizing cash that typically arise in various parts of the world. Non-US multinationals investing into the US: Operational and strategic considerations (February 14)
The passage of the Tax Cuts and Jobs Act on December 22, 2017 represents the first major overhaul of the US federal income tax system in more than 30 years and triggers immediate and far-reaching international business and tax consequences. During this Thought Center Webcast, Ernst & Young professionals will examine the legislation that will materially impact many non-US multinationals' financial reporting, operational (e.g., supply chain and treasury) and mergers and acquisitions frameworks. Assessing trade implications of recent global developments (February 14)
During this Thought Center Webcast, a select team of our tax and legal professionals discuss the practical implications for trade of the current uncertainty around US tax reform, the North American Free Trade Agreement (NAFTA), BREXIT and the Trans-Pacific Partnership (TPP). Our panel will also review how tax and legal functions might work more closely together to advise their business constituents on preparing for these developments and further changes. —————————————————————————
Recent Tax Alerts —————————————————————————
IRS Weekly Wrap-Up Internal Revenue Bulletin | | 2018-05 | Internal Revenue Bulletin of January 29, 2018 |
Because the matters covered herein are complicated, U.S. International Tax This Week should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor. Document ID: 2018-0243 | 
