US lawmakers to hold hearings on BEPS, EU State aid cases

(Updated 11/25/2015) The US Senate Finance Committee will consider the OECD/G20 base erosion profit shifting (BEPS) project and the European Commission’s State aid challenges to private tax rulings entered into between EU States and multinationals at a hearing, scheduled for December 1, Committee Chairman Orrin Hatch (R-Utah) announced November 24.

The House Ways and Means Subcommittee on Tax Policy will hold a separate hearing on BEPS earlier that same day, the committee’s chairman,  Charles Boustany (R-LA), said in a separate announcement.

While the House panel has not yet scheduled witnesses, the Senate committee hearing will feature two witnesses: Dorothy B. Coleman, Vice President, Tax and Domestic Economic Policy of the National Association of Manufacturers and Robert B. Stack, Treasury Deputy Assistant Secretary for International Tax Affairs.

Hatch said that while the objectives of the OECD’s BEPS project are “laudable,” the BEPS reports “raise a number of serious concerns about taxpayer confidentiality and the Treasury Department’s statutory authority to implement regulations as envisioned by the project.”

Hatch also said that EU investigations into American multinationals “have resulted in increased uncertainty and foreign tax liabilities for our businesses abroad.”

He said that given these concerns, he expected “a robust discussion at this hearing on what the OECD BEPS project means for US taxpayers and our tax system moving forward, as well as how the EU State aid investigations could potentially affect tax revenues paid to the US Treasury.”

Hatch has previously expressed concern that the BEPS project output, particularly the work on country-by-country reporting, would harm US interests, imposing burdens on both the IRS and business and requiring the revelation of confidential business information to foreign tax authorities. He has called on Treasury to consult with Congress on the initiative and has asked the Government Accountability Office to undertake an in-depth analysis of the OECD’s BEPS project.