TEI Urges Senate Foreign Relations Committee Action on Pending U.S. Tax Treaties and Protocols.

• Position: Tax Executives Institute

On April 19, TEI submitted a letter to the Chair and ranking Member of the Senate Committee on Foreign Relations urging expeditious action to review and approve the many pending bilateral U.S. income tax treaties and protocols transmitted to the Senate over the past decade. TEI's comments were prepared under the aegises of the Institute's U.S. International Tax Committee and Tax Reform Task Force, whose chairs are Sarah Winters and Emily Whittenburg, respectively. Benjamin R. Shreck, TEI Tax Counsel, coordinated the production of TEI's comments.

The bilateral income tax treaties and protocols pending before the Committee on Foreign Relations are important to U.S. economic growth and U.S. trade and tax policy, as well as from tax compliance and administration perspectives. Bilateral income tax treaties and protocols provide certainty for taxpayers conducting cross-border business and assist the Internal Revenue Service in administering the Internal Revenue Code provisions applicable to such multinational business transactions. On behalf of Tax Executives Institute, Inc. (TEI), I ask for your support for these treaties and protocols and for expeditious action on them by the United States Senate.

TEI is the preeminent association of in-house tax professionals, worldwide. Our approximately 7,000 members represent more than 2,800 companies of all sizes and across all industries. The organization is represented by 57 chapters in North and South America, Europe, and Asia. TEI members are responsible for managing the day-to-day tax affairs of their companies, including companies that conduct cross-border business transactions and which rely upon the certainty provided by the U.S. network of bilateral income tax treaties.

Many of the bilateral income tax treaties and protocols pending before the Committee were signed and transmitted to the Senate years ago. (1) Regrettably, the subsequent protracted period of ratification leaves many taxpayers in limbo when planning their cross-border business and tax affairs, as it has become unclear whether a duly negotiated and signed treaty or protocol will ever enter into force. While historically multinational taxpayers could count on such tax treaties and protocols entering into force in short order, that is no longer the case and the concomitant uncertainty results in many foregone business opportunities for both U.S. and foreign based companies that would benefit the U.S. economy.

Moreover, income tax...