Business Tax Compliance and Complexity

It Pays to Keep It Simple

Simplicity in the tax code means taxes should be easy for taxpayers to pay and easy for governments to administer and collect.

BEFIT: One-Stop-Shop or One-More-Stop?

On 12 September, the European Commission released a proposal called “Business in Europe: Framework for Income Taxation” (BEFIT) and two associated proposals on transfer pricing and a Head of Office tax system.

Leave Worldwide Combined Reporting in the ‘80s, Where It Belongs

Given enough time, everything old is new again—including tax ideas best consigned to history. But worldwide combined reporting, which a few states flirted with in the 1980s, is rearing its head again.

The Tax Policy Implications of the Spanish Elections at the Regional, National, and European Levels

The Spanish election results are moving the country away from pro-growth tax reforms while launching the government’s tax agenda, and the agenda of the Spanish presidency of the Council of the European Union, into uncertainty.

Risks to the U.S. Tax Base from Pillar Two

A growing international tax agreement known as Pillar Two presents two new threats to the U.S. tax base: potential lost revenue and limitations on Congress’s ability to set its own tax policy.

How Bermuda’s New Corporate Income Tax Could Negatively Impact Some OECD Member States

Bermuda, long celebrated for its pristine beaches and offshore financial services, is embarking on a journey to recalibrate its tax mix. Spurred by the OECD’s Pillar Two initiative, the island will introduce its first-ever corporate income tax in 2025.

The Inflation Reduction Act One Year Later

One year after its enactment, there are concerns about the Inflation Reduction Acts overall fiscal impact, the additional complexity it introduces to the tax system, and the sustainability of its initiatives.

States Move Away from Throwback and Throwout Rules

As more and more states move away from throwback or throwout rules, those states that still impose these rules are becoming less attractive for businesses, which are incentivized to relocate their sales activities to non-throwback states.

Net Operating Loss Carryforward and Carryback Provisions in Europe

Carryover tax provisions help businesses “smooth” their risk and income, making the tax code more neutral across investments and over time.

The Big Business of Tax-Free College Sports

Moving from one athletic conference to another can mean millions in additional revenue sharing from lucrative broadcasting contracts and other revenue streams, all tax-free.

Global Tax Tug of War: Comparing the UN and OECD Approaches

The United Nations (UN) is preparing to flex its muscles on international tax policy. Several developing countries say the OECD’s approach favors richer countries at their expense, and the UN hopes to fix this.

Summary of the Tax Credits Claimed on the Form 1040, Tax Year 2020

In tax year 2020, taxpayers claimed more than 159 million tax credits on their individual income tax returns worth a total of more than $277 billion. That was an increase of $35.3 billion from tax year 2019, largely due to an influx of pandemic relief administered through the tax code in 2020.

Inflation Reduction Act One Year After Enactment

Congress should reconsider key elements of the IRA, including the book minimum tax and the green energy credits, with an eye towards simplification and fiscal responsibility.

Patent Box Regimes in Europe, 2023

The aim of patent boxes is generally to encourage and attract local research and development (R&D) and to incentivize businesses to locate IP in the country. However, patent boxes can introduce another level of complexity to a tax system, and some recent research questions whether patent boxes are actually effective in driving innovation.

Weeding the Garden of International Tax

Simplifying international tax rules will not solve all the challenges that stand in the way of healthy cross-border investment, but eliminating unnecessary provisions would be a positive pivot relative to the trajectory of recent years. It’s high time that policymakers stopped pursuing ever more complex rules and started the hard work of simplification.

“Monetizing” Clean Energy Tax Credits Creates a Sham Market for Bad Policy

Explore IRS clean energy tax credits, including Direct Pay, the IRA and CHIPS Act tax provisions, and Section 1603 grant program. See more.

The U.S. Tax Code Is Too Complex for Direct eFile to Work

It is hard to imagine the IRS Direct e-File Program operating seamlessly with the complexity of the current U.S. tax system. Instead, lawmakers should first address the more fundamental problem that causes taxpayer frustration: our highly complicated tax code.

Details and Analysis of a Tax Reform Plan for Growth and Opportunity

The federal tax code remains a major source of frustration and controversy for Americans, and a hindrance to economic growth and opportunity. Other countries, such as Estonia, have proven that sufficient tax revenue can be collected in a less frustrating and more efficient way.

Distributed Profits Tax

Testimony: Reviewing Recent Federal Tax Policies and Considering Pro-Growth Reforms

Lawmakers should focus on simplifying the federal tax code, creating stability, and broadly improving economic incentives. There are incremental steps that can be made on the path to fundamental tax reform.