USA: Senate Bill is out
For those into the details please see the attached power point (from our Holsinger CPE Day – right after the House bill came out on 11/2t) which gives a 20 page summary of the House bill. The news is that the Senate bill (released a week later) largely mirrored the House bill. And both bills are politically… challenging (a.k.a. impossible). The take away is this. The “Tax Reform” as proposed by both Senate and House bills lowers the corporate tax rate from the highest in the industrialized world to 20%, which is slightly below our major European countries / “competitors”. Further it does not tax offshore dividend repatriation. It is notable that unlike our European friends, the US has no Value Added Tax (VAT) system (a tax which has no votes in Congress… yet). Therefore:- moving the corporate rate downward with zero rate dividend repatriation on offshore corporate earnings, and …
- moving pass through rate (owners of Partnerships and S Corps) down to 25%++++ (see attached power point), creates …
- A HUGE revenue loss for the Government fisc.
- And the ZEN game for business owners is – what happens if the Democrats take over with huge majorities in 4 years…. This is the larger modeling exercise….