USA Tax Trends to Watch in 2014

USA Tax Trends to Watch in 2014

By Bobby Barnes (posted 15.01.2014)

Earlier this month, published an article outlining some of the changes (or lace of change in one case) on U.S. Federal/State Tax codes, along with the implications connected as we move forward into 2014.

More than four dozen tax provisions that allow for tax breaks expired when the clock struck midnight on January 1st 2014. While Congress does have the authority to retroactively pass these provisions at any point in the year, the challenge is going to be to find a bill guaranteed to pass Congress to which they can be attached. If they are not passed early they may not pass until November of this year due to midterm elections, at which time the issue of how they will be paid for will be more of an issue.

In 2013 the EU, OECD and G-20 all took steps to cut down on tax avoidance by multinationals and it appears this will continue to be an issue this year as the bodies continue to put pressure to halt practices that allow these companies to pay no taxes in any jurisdiction in which they are located.

Sales tax collection on online sales by state Departments of Revenue has long been a source of contention. Up to this point many online sales have been exempt but a December 2013 Supreme Court ruling upholding New York's law requiring online retailers has effectively opened the door for other states to follow suit.

Federal tax reform is another long-standing issue in US politics. With influential members of the House Ways and Means Committee and the Senate Finance Committee leaving within the next year, questions abound over whether drafts introduced by these members can be built upon.

While Federal tax reform will most likely stall, reform on the state level is much more likely as states look to leverage new ways to raise revenue, specifically through fees, casino gambling, and other non-tax sources. Specific states to keep an eye on are Texas, Oklahoma, Illinois, South Carolina, and Wisconsin.


Bobby Barnes
USA Country Head

Tel: +1 919 977 6610 / 6611

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