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Potential US tax reform: a better way for America?
Taxand Switzerland and Taxand USA provide a short summary and overview of the potential US tax reform proposed by the Republican Party and President Trump particularly from the perspective of Swiss producers and Swiss consumers.
On 8 November 2016, Donald Trump was elected as the new President of the United States of America. In addition to the Republican President, both houses of the Congress and thus, both the executive and the legislative bodies are controlled by majorities of the Republican Party. Thus, whether and to what extent changes in the law, including the tax laws, will be introduced under the Presidency of Donald Trump, seems to lie predominantly in the hands of the Republican Party. This unique situation puts the Republicans under pressure to act. Fundamental changes of the tax system and the tax laws were one of the key subjects during the election campaign of both the Republican Party and Donald Trump.
The so-called Blueprint issued on 24 June 2016, by the Tax Reform Task Force of the Republican Party, outlines the Party’s view of a fundamentally new tax system. Based on the above mentioned political constellation, it seems likely that at least major parts of the ideas laid-down in the Blueprint may indeed be enacted, probably still in 2017 (and eventually even with retroactive effect as per 1 January 2017).
Some of the fundamental changes also effect Swiss producers who are selling their goods/services on the US market, be it directly, through a US subsidiary or a third-party distributor. Furthermore, it also effects Swiss distributors and ultimately Swiss consumers of products manufactured in/imported from the US.
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No doubt the further developments in the US tax system will be one of the most interesting and important topics of the current year, with immense impacts on the future. Governments, corporations, banks, taxpayers, tax consultants as well as producers, traders and consumers not only in the United Sates, but from around the world, will carefully watch the decisions taken by President Trump and the legislative branches of the United States.