Tag Archives: tax reform

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Argentina – Client Alert – Tax Reform

The Argentine Congress approved a comprehensive tax reform in Argentina, effective in general January 1st, 2018. This summary describes some of the main changes:

A. Corporate income tax rate and dividend withholding tax

The corporate income tax rate is decreased from 35% to 30% for fiscal years starting 1 January 2018 to 31 December 2019, and to 25% for fiscal years starting 1 January 2020, and onwards. Dividend withholding tax rates of 7% for profits accrued during fiscal years starting 1 January 2018 to 31 December 2019, and 13% for profits accrued in fiscal years starting 1 January 2020 and onwards. The new withholding rates would apply to distributions made to shareholders qualifying as resident individuals or nonresidents. Additionally, the reform repeals the 35% “equalization tax” as from 1 January 2018.

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Communicating the Benefits of 401(k) Plan Participation

When deliberations began regarding the first tax reform legislation in over thirty years, many raised concerns that tax reform measures would adversely affect retirement savings programs such as the 401(k) plan.  Now, as the tax reform proposals have become further vetted, the 401(k) approach to pre-tax retirement savings appears to remain intact and may actually survive “Rothification”.  The IRS also recently increased the 401(k) pre-tax savings contribution limit to $18,500 for 2018.  Despite the confirmed importance of retirement savings vehicles such as the 401(k) Plan, many eligible participants for these employer-sponsored programs do not enroll in the plans, fail to contribute as much as they could, or do not fully understand how to maximize their benefits or select their investment options.  Multigenerational employees also have different financial needs and perceptions, and receive communications differently.   Plan sponsors should take this opportunity, as passage of tax reform legislation appears imminent, to provide eligible employees and participants with an enhanced communications program touting the benefits of 401(k) plan participation.

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GOP Tax Legislation Poses Challenges to the Health Care Industry

Perspectives on Health Care and Life Sciences advisory by Bob Atlas, President of EBG Advisors, Inc. 

Following is an excerpt:

The U.S. Senate and House of Representatives have both passed their tax reform bills and will now confer toward creating a unified bill that both chambers can support, and that President Trump will sign. The two bills differ in some key respects, but their implications for health care are already rather clear. Some aspects of the legislation explicitly touch health care, while other effects would be indirect. Overall, it appears that most of the changes would adversely affect many health care industry participants, especially those in the nonprofit sector that would not gain from the reduction in the corporate tax rate that is the central feature of the legislation. …

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North Carolina: Tax Foundation characterizes the state as a model for tax reform

The Tax Foundation, whose singular vision is “a world where the tax code doesn’t stand in the way of success,” has become bullish on North Carolina’s tax reform success, going so far as to characterize it as a “model for tax reform” in a speech last week at an event.

In its 2017 State Business Tax Climate Index the Tax Foundation swooned over the Tar Heel State’s “most dramatic improvement in the Index’s history—from 41st to 11th in one year.” The index considers how well states structure their tax systems relative to each other, rather than how much state governments collect in taxes, in part because “even in our global economy, states’ stiffest competition often comes from other states.” Indeed, tax competition is an “effective restraint on state and local taxes…states with more competitive tax systems score well in the Index, because they are best suited to generate economic growth.”

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Think Tank: 2017 is shaping up to be a major year for state gas tax reform

The Institute on Taxation and Economic Policy (Institute) released a late December article predicting that significant gas tax reforms will occur in numerous states in 2017. As examples, the Institute pointed to Alaska’s Gov. Bill Walker, who has proposed tripling his state’s gas tax; and Indiana, Louisiana, and Tennessee, where officials are considering their own reforms. “Altogether, it appears that more than a dozen states will seriously debate gas tax changes next year.”

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South Carolina: Tax reform is back on the table

In December 2010, the South Carolina Taxation Realignment Commission (TRAC) issued its 240 page Final Report, the result of “the most comprehensive and holistic study of [the] [s]tate’s tax structure.” The report contains TRAC’s assessment of the adequacy, fairness, and efficiency of the Palmetto State’s tax system, with the ultimate goal of ensuring that “South Carolina remains an optimum competitor in its efforts to attract business and individuals to locate, live, work, and invest in” the state.

The report concluded that while South Carolina is a low tax state, compared to its neighbors, the region, and nationally, the current tax structure is hindered by structural deficiencies that challenge the system’s ability to produce a stable stream of revenue over time, for even the most basic of services. Additionally, the current structure is inadequate for producing a system that is fair in its treatment of all taxpayers.

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Government Strategies Advisory: Tax Reform

Since Congress last reformed the Internal Revenue Code in 1986, there have been more than 20,000 statutory changes to the tax code. Many economists argue that as global commerce gets more sophisticated and competitive, the tax code is getting more burdensome and harmful to economic growth. Democrats and Republicans alike have called for comprehensive tax reform to reduce marginal tax rates and close unnecessary tax loopholes to better address our nation’s priorities.

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McDonald Hopkins Government Strategies Advisory: Tax Reform Gets Green Light

Yesterday, Speaker of the House John Boehner (R-OH) announced that in the 113th Congress, H.R. 1 – traditionally the designation given to legislation deemed most important by the majority – would be reserved for tax reform.

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