TEI Testifies on Complexity of Tax Code's International Provisions.Calling proposed legislation to simplify the international tax provisions of the Internal Revenue Code The Internal Revenue Code is the body of law that codifies all federal tax laws, including income, estate, gift, excise, alcohol, tobacco, and employment taxes. These laws constitute title 26 of the U.S. Code (26 U.S.C.A. § 1 et seq. a "major leap forward," Tax Executives Institute President Lester D. Ezrati urged the House Ways and Means WAYS AND MEANS. In legislative assemblies there is usually appointed a committee whose duties are to inquire into, and propose to the house, the ways and means to be adopted to raise funds for the use of the government. This body is called the committee of ways and means. Oversight Subcommittee to find ways to bring further clarity to what are among the most complicated provisions in the tax law. "TEI 1. (communications) TEI - Terminal Endpoint Identifier. 2. (text, project) TEI - Text Encoding Initiative. believes that the Code's foreign provisions need fundamental reform and simplification," he said in June 22 testimony, "and for this reason we support H.R. 2018, the International Tax Simplification for American Competitiveness Act of 1999." The act was introduced on June 7 by Oversight Subcommittee Chairman Amo Houghton Amory "Amo" Houghton Jr. (b. August 7, 1926) is a politician from the state of New York and member of the Houghton family. Early life Houghton was born in Corning, New York, and went to St. Paul's School in Concord, New Hampshire. and several other representatives, and its provisions address areas including foreign tax credits and the tax treatment of controlled foreign corporations Controlled foreign corporation (CFC) A foreign corporation whose voting stock is more than 50% owned by US stockholders, each of whom owns at least 10% of the voting power. . "Enactment of this bill," said Mr. Ezrati, "will generally reduce the costs of preparing U.S. corporate tax returns for American companies engaged in international trade without any material diminution in tax dollars flowing to the treasury. The bill will not only reduce compliance costs -- thereby enhancing the country's competitiveness -- but it will also signal Congress's continued commitment to the simplification of the tax law." Any simplification efforts, Mr. Ezrati said, will need to comprehend the changing face of the business environment. "Electronic commerce and business technologies are making it increasingly important for governments and taxpayers to resolve -- or forestall -- disputes in creative, cost-effective ways, such as advanced pricing agreements," he said. "And although we see this as a major leap forward, enactment of the bill will not obviate ob·vi·ate tr.v. ob·vi·at·ed, ob·vi·at·ing, ob·vi·ates To anticipate and dispose of effectively; render unnecessary. See Synonyms at prevent. additional reform of the Code's international tax provisions, particularly in respect of subpart F Subpart F Special category of foreign-source "unearned" income that is currently taxed by the IRS whether or not it is remitted to the US , which Chairman Houghton himself has singled out as an extremely complex area of the law, the translation of the deemed paid tax credit under section 986, and the elimination of the interest allocation rules." TEI's comments are reprinted in this issue of The Tax Executive, beginning on page 347. |
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