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Ryan Questions If Tax Waivers Part Of US-Iran Deal

by Mike Godfrey, Tax-News.com, Washington

25 September 2015


US House of Representatives Ways and Means Committee Chairman Paul Ryan (R – Wisconsin) has sent a letter to President Barack Obama asking him to clarify whether he intends to waive tax code provisions directed at illicit Iranian behavior.

He noted that the Administration recently agreed the Joint Comprehensive Plan of Action (JCPOA), under which the United States is to "dismantle the US and multilateral sanctions framework against Iran in the hopes of discouraging its nuclear program," and "provide Iran access to [up to] USD150bn of previously frozen funds, not to mention hundreds of billions of dollars of increased investment and trade flows."

He also pointed out that, under current law, "US companies and individuals located or doing business in Iran and certain other countries face punitive taxes under [the US tax code]. … Taxpayers are denied foreign tax credits for taxes paid to such countries; and US shareholders are taxed immediately on any income earned in such countries by controlled foreign corporations."

Although the President may waive both provisions if he deems such a waiver "is in the national interest and will expand trade and investment opportunities for US companies in such countries," he must report any such waiver to the US Congress 30 days in advance.

Ryan therefore asked in his letter whether the Administration, "in light of the JCPOA and the statutory framework, has made any direct or indirect commitment or promise of any kind, whether or not in writing, that you will exercise your waiver authority with respect to Iran." He also requested whether the President "will commit not to exercise the waiver authority with respect to Iran during the remainder of [his] term in office."

TAGS: tax | business | law | corporation tax | tax credits | multinationals | controlled foreign corporations (CFC) | transfer pricing | United States | penalties | Iran | Tax

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