Bloomberg BNA quoted H. David Rosenbloom and Peter A. Barnes regarding the Obama administration's annual budget requests, which outlined several policy proposals to the international tax system. For the complete article, please click on the link above to view a PDF.
Excerpt taken from the article.
Furthermore, transitioning away from the check-the-box regime—potentially disrupting corporate structures worth billions of dollars—could be destructive.
"It would be chaotic," said David Rosenbloom of Caplin & Drysdale, a former international tax counsel for the Department of Treasury. "You'd have all sorts of transitional issues that would be literally mind-blowing. … The problem with check the box is, it cuts very deep at this point. It's been around for a long time, people have relied on it. Undoing it would be quite a task."
Included in each of Obama's annual budget requests has been a proposal to "limit shifting of income through intangible property transfers" (22 Transfer Pricing Report 1364, 3/6/14).
"A lot of the issues that are concerning intangibles can be addressed through regulations," said Peter Barnes of Caplin & Drysdale. "It would be controversial."
While observers often are pessimistic about the chances for a bipartisan tax overhaul in the near future, it remains a significant policy agenda for both parties, and the administration may be reluctant to throw a monkey wrench into that process.
"Tax reform is so important, and the changes that are being considered are so important, that we need stability in whatever emerges," said Barnes Of Caplin & Drysdale. "The minute you have doubt about whether the changes are long-lasting, you've undermined the effectiveness of any reform."