Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

February 17, 2023
2023-5205

Report on recent US international tax developments 17 February 2023

The United States (US) Internal Revenue Service (IRS) will not release proposed regulations on previously taxed earnings and profits (PTEP) until the latter half of 2023, according to an IRS official this week. The Government has announced delays in the release of the eagerly anticipated regulatory package on several occasions, most recently last fall. The official was quoted as saying the complex guidance will be released over a period of years in multiple packages and warned taxpayers that while this year’s regulations would address pressing concerns, taxpayers would not see all their questions answered in the first tranche.

US Senate Finance Committee member Sherrod Brown and Chairman Ron Wyden introduced the Stock Buyback Accountability Act of 2023, which would increase the recently enacted one percent stock buyback excise tax to four percent. In the 7 February State of the Union Address, President Joe Biden called for quadrupling the buyback excise tax that was included in the Inflation Reduction Act. The proposal is unlikely to be enacted in a divided Congress.

The press is reporting that the proposed US-Chile tax treaty is stalled due to disagreement among Senate Finance Committee Republicans and Treasury on the issue of foreign tax credits. Committee Republicans reportedly want clarification in treaty language that US companies will not face double taxation in certain situations. The Senate Foreign Relations Committee cleared the proposed US-Chile tax treaty in the last Congress, although it was not brought to the floor of the Senate for a vote. The treaty therefore must again go through committee approval in the new 118th Congress.

_________________________________________

For additional information with respect to this Alert, please contact the following:

Ernst & Young LLP (United States), International Tax and Transaction Services, Washington, DC

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2023, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct