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Trump’s tax reform plan for repatriated funds to the U.S. economy will increase mergers and acquisitions, Apple, Microsoft & Google benefit the most.

Suggested Reading: Spring 2017

Trump Administration’s Tax Reform Plan: You can read the one-page summary released by the Administration, and a concise summary of the plan, in this article from Bloomberg. In addition, a White House statement from National Economic Council Director Gary Cohn provides additional detail into the elements of the proposal.

Impact of Trump Tax Plan on Pass-Through: The Administration intends to reduce the income tax rate for pass-through entities (like partnerships, S corporations) to 15%. Could this be an engine of economic stimulus for small businesses? USA Today provides some detail on the proposal.

House GOP Provides Detail on Border-Adjusted Tax Plan: While the prospects for a BAT are less than promising, given that the Trump plan does not include one, the proposal still merits study; you can find the GOP blueprint document for the BAT here.

Tax Foundation Answers FAQs about BAT: As proposed by House GOP, a number of questions were raised, including how such a plan would work, and its potential impact on the U.S. economy. This Tax Foundation article attempts to answer these and other frequently asked questions on the BAT.

Tech Firms Among Biggest Winners in Repatriation: Apple, Microsoft and Google are likely to benefit the most from the proposal to impose a one-time reduced tax on funds repatriated to the U.S., according to this Fast Company article, which states that tech companies have parked as much as 90% of their cash in foreign subsidiaries.

Repatriation Proposal May Stir M&A Activity: Many observers feel that Trump tax reform proposal for one-time tax on funds repatriated to the U.S. will spur an increase in mergers and acquisitions by cash-rich companies, particularly in the tech market. This Market Watch article looks at the potential for merger activity in the wake of the repatriation proposal and other factors.

Tax Reform Proposals May Have Impact on Entity Choice:  Accounting Today discusses a variety of factors that companies should consider in analyzing current and prospective entity choices. The article notes that companies need to consider non-income tax factors, such as access to capital and liability issues, as well as considering the potential elimination of the estate tax.


 Business Tax Quarterly – Spring 2017

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