Doing Business in the United States guides you through the developments on US tax and trade policy. In addition to providing explanations of the tax provisions of interest to global multinational companies expanding or starting business in the United States, the guide includes updates on new guidance from Treasury and the IRS, as well as practical insights. This latest edition includes the following key sections:
Summaries of key tax law changes enacted on March 27, 2020, as part of the CARES Act, as well as state-level legislative and regulatory trends.
An expanded section on US customs duties and import tariffs to reflect the higher profile of trade issues facing businesses in the past year, and major developments such as the USMCA trade agreement, the US-China ‘Phase One’ agreement, and US responses to various global ‘digital tax’ legislation in different countries.
Key US tax policy issues for global companies to stay informed of in 2020.
Dive into our observations on basic tax implications for businesses operating in the United States, and the tax consequences for US operations of global businesses. Topics include:
Here's how we can help your business and investment in the United States:
US tax and trade policy and the related legislation and regulations have undergone significant changes since the previous edition of Doing Business in the United States was released. US tax policy has reacted to the global COVID-19 pandemic, which has created economic upheaval and a level of uncertainty to a degree not seen in many years. Meanwhile, US trade policy with respect to many important trading partners also has seen significant changes. These changes may have significant implications for your business operations in the United States. As a company investing in the US, you will need to:
Some notable developments with potentially significant implications for your US operations include:
Read Doing Business in the United States to learn more about how these developments may affect your operations in the United States.
The states are continuing to react to the 2017 US federal tax reform act by passing legislation adopting or rejecting certain provisions of that act, and to the US Supreme Court’s decision in South Dakota v. Wayfair, which allowed states to impose sales tax collection responsibility on entities lacking an in-state physical presence.
On top of those important federal-level developments, states are also addressing the ‘Coronavirus Aid, Relief, and Economic Security Act’ (CARES Act), major federal legislation responding to the COVID-19 pandemic. CARES Act provisions that have potential state tax implications include:
Read Doing Business in the United States to learn more about how these tax law changes may affect your operations in the United States.
Since enactment in late 2017 of US tax reform legislation that made important changes affecting financing of your US operations — such as new limitations on interest expense deductions, new anti-hybrid rules, and the new ‘base erosion and anti-abuse tax’ (BEAT) — the IRS and Treasury have issued extensive regulations addressing important issues raised by these new provisions.
Read Doing Business in the United States to learn more about how these Internal Revenue Code provisions and the regulations issued under them may affect financing of your operations in the United States.
Defining success for tax: Each US tax department must identify the factors that determine success for the organization and establish benchmarks and objectives to measure performance related to those factors. Building in agility is key to managing the complexity of tax law changes. Now more than ever before, tax needs to respond quickly to access data and models for planning, forecasting, compliance, controversy and advocacy.
Deploying technology and data analytics: Technology and data analytics solutions are now critical to efficiently and effectively executing all aspects of the tax lifecycle. "Small automation" is a growing trend that empowers tax professionals to leverage multiple technologies to secure quick process wins without the need for large-scale IT involvement. Emerging technology solutions such as artificial intelligence (AI) and machine learning (ML) are also gaining popularity—these powerful new tools can be used to perform structured and unstructured activities, and can gather and analyze data from multiple sources.
Focusing on people and organization: Technical tax skills are important, but they are no longer sufficient. To keep up with the rapid pace of technological change and tax complexity, tax professionals need new capabilities. Digital upskilling will enable tax professionals to use new solutions to perform work more efficiently and effectively. A center of excellence (CoE) for digital innovation—a digital lab focused on developing new solutions to business and tax problems—is a great way to engage and train professionals. When deployment of people and technology resources is not feasible, a variety of sourcing models are available to meet the needs of the US tax department’s functions.
Being mindful of process and collaboration: A well-run US tax department needs to have defined processes, enabled by technology; however, to be successful, the tax department will need to reach beyond its boundaries, collaborating with other enterprise functions to capture synergies and contribute to return on investment. Whether it’s about an enterprise approach to emerging technologies or the growing concerns around customs and trade, the tax function needs to be included in the discussion to offer tax perspective on opportunities and risk. Tax should become the trusted advisor to business leadership that the organization needs.
Read Doing Business in the United States and Tax Function of the Future, Tax and Finance Priorities for 2019 to learn more about how these developments may affect your operations in the United States.
The 2017 US tax reform law changed individual provisions significantly:
How does all of this affect you?
As a result of these changes, you and your mobile workforce—those individuals working in the United States, or US citizens or residents working abroad—need to:
Read Doing Business in the United States to learn more about how changes to the US individual tax provisions may affect your US operations.
Partner, US Inbounds Tax, PwC US