Months after the signing into law of the most fundamental tax reform in the U.S. in over 30 years, the annual OECD International Tax Conference, organized by USCIB in cooperation with the OECD and Business at OECD, convened earlier this week in Washington, D.C. to assess the impact of the new law on U.S. multinational companies, reforms in other countries, as well as on cross-border trade and investment.
Some speakers, such as Louise Weingrod (Johnson & Johnson) spoke of the generally positive environment that has resulted from the new tax law, such as a more level-playing field for MNCs and increases in capital investment by U.S. companies. Chairman of the Council of Economic Advisers Kevin Hassett, who gave keynote remarks during the conference, stated that tax reform has been spurring growth and that U.S. reform will spur additional reform in other countries. He also said that reducing the corporate tax rate to 21 percent would have been enough but that the Trump administration tackled some of the other issues too, which has had the desired effect on margins.
“U.S. tax reform is but one piece of an increasingly complex puzzle of changing global tax rules that companies must navigate,” said USCIB President and CEO Peter M. Robinson. “As technology, business models and supply chains have evolved, it is more critical than ever to bring certainty to international tax rules, in order to promote global growth and avoid double taxation. The conference provided an unparalleled opportunity to learn about, and influence, the latest developments in the global taxation system.”
While U.S. tax reform was a contentious issue at the conference, other policy matters were also raised, specifically those related to transfer pricing, dealing with tax-related disputes through arbitration, implementation of the OECD’s multilateral instrument, development with regards to the United Nations Sustainable Development Goals, as well as tax challenges arising from digitalization.
Bill Sample (Microsoft), who is the vice chair of the Business at OECD Taxation and Fiscal Policy Committee and chairs the USCIB Tax Committee, reflected on the key issues for the business community that need to be addressed to get to a G20-mandated, consensus-based solution by 2020 with regards to digitalization. “Business recognizes the political pressure to reach consensus. But for business to be fully engaged, whatever the consensus is, it will need to bear a rational relationship to value creation,” he emphasized.
The sold-out conference, which was held June 4-5 gathered over 300 tax experts, academics and business representatives to interact directly with key leadership from the OECD, its Center for Tax Policy and Administration (CTFA), and senior tax officials from the U.S. and other OECD countries, including Canada, France and Germany. The conference has grown into an annual must-attend event for tax practitioners, experts and regulators from around the world.