ADDENDUM JUNE 24, 2005
THE UNITED STATES COUNCIL FOR INTERNATIONAL
BUSINESS
(A BUSINESS ASSOCIATION)
SUBMITS THESE COMMENTS TO
THE PRESIDENT’S ADVISORY PANEL ON FEDERAL TAX
REFORM
JUNE 10, 2005
Submitted by:
Michael Reilly
Chair, Taxation Committee
Andrew B. Breslow
Chair, Tax Legislative & Administrative Developments Subcommittee
Richard M. Hammer
International Tax Counsel
United States Council for International Business
1212 Avenue of the Americas, New York, New York 10036-1689
Tel: 212-354-4480 Fax: 212-575-0327 E-mail: [email protected] Internet: www.uscib.org
COMMENTS FOR
THE PRESIDENT’S ADVISORY PANEL ON FEDERAL TAX REFORM
SUBMITTED BY
THE UNITED STATES COUNCIL FOR INTERNATIONAL BUSSINESS
JUNE 24, 2005 ADDENDUM
In the June 10, 2005 submission to the above named Presidential advisory panel (the
Panel), the United States Council for International Business (USCIB) discussed, and
opined on, certain key policy issues that must be addressed by the Panel in considering a
major overhaul of the Internal Revenue Code (the Code), namely, the preference for
instituting an integrated tax system (i.e., terminating the double taxation of corporate
earnings), and the absolute necessity of enhancing the international competitveness of
U.S. business. The goal of enhancing the competitive position of U.S. business would be
best served by a complete repeal of Subpart F of the Code, to strengthen deferral by not
unfairly burdening unremitted overseas earnings, and ensuring the establishment of the
best possible foreign tax credit mechanism to minimize international double taxation.
As part of any fundamental tax reform package, the Panel should bear in mind that the
competitiveness of U.S. business would be further improved by ensuring that the United
States itself became the most competitive location in which to establish and maintain a
business enterprise. Today, as the global economy expands, countries are lowering tax
rates and tax burdens so as to encourage foreign business investment into their
jurisdictions. In the recent decades, the United States has been a global leader in
attracting foreign direct investment. As other overseas markets mature, however, and thus
provide alternative growth opportunities, the U.S. should examine, and discard, tax
policies that discriminate against capital intensive, job creating foreign investment. In
other words, our nation should strive to create and maintain a tax system which attracts
and retains both foreign and domestic business investment and avoids disincentives for
such investment. Furthermore, any form of discriminatory tax measures in this country
aimed at foreigners could generate the enactment of retaliatory measures by our trading
partners to the detriment of U.S. business.
United States Council for International Business
1212 Avenue of the Americas, New York, New York 10036-1689
Tel: 212-354-4480 Fax: 212-575-0327 E-mail: [email protected] Internet: www.uscib.org