As we noted in our last blog post, 2017 could well turn out to be a singular year in the American business world, given the "different scenarios for possible corporate tax reforms" currently being evaluated and floated about on Capitol Hill.
We underscored in our May 17 post entry a central point stressed in a news report authored by the national publication Accounting Today, namely that corporate principals must quickly and completely "understand what their levers are" in the current business climate.
What that fundamentally means is that businesses need to conduct all the due diligence they possibly can now and thoroughly evaluate their findings in order to be ready to act in response to material tax-related changes that might -- or, indeed, might not -- ensue.
As Accounting Today states, "certain elections and certain positions should be maximized this year before the tax law changes."
And, concomitantly, it is obviously a good idea for a commercial enterprise to have timely done the homework that enables it to act in a manner that best promotes company interests following the implementation of any new laws or guidelines.
Although the above publication makes several points regarding potential changes in the near future that could significantly impact many American businesses, it especially stresses these two possibilities:
- A border-adjustment tax on imports to help defray lost revenues that might reasonably occur from the "drastic tax rate reduction" currently being proposed by the new presidential administration; and
- A materially lowered tax rate on businesses itself, which Accounting Today states "seems to be the one item that has the most support across the board"
And then there is this: New incentives could be proposed to entice businesses with significant holdings abroad to repatriate earnings. Companies that see an advantage to such opportunity will need to have a sound plan in place for reapplying money domestically in the most sensible way.
For many businesses, there is much to think about currently from a regulatory, tax-planning and development perspective. A proven commercial law firm that routinely assists diverse clients can help identity both challenges and opportunities in what reasonably seems to be a new and bracing business environment.