Treasury Can Use Tax Regulations to Deter Inversions, Ex-Official Says

For over 50 years, Bloomberg BNA’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...

The Treasury Department should use immediate stopgap regulations to make offshore transactions known as corporate inversions less lucrative, says the department's former top international tax lawyer. The administration can unilaterally limit inverted companies from taking interest deductions in the U.S. or from accessing their foreign cash without paying U.S. taxes, Stephen Shay says in an interview. “If you take away the incentives, a largThe Treasury Department should use immediate stopgap regulations to make offshore transactions known as corporate inversions less lucrative, says the department's former top international tax lawyer. The administration can unilaterally limit inverted companies from taking interest deductions in the U.S. or from accessing their foreign cash without paying U.S. taxes, Stephen Shay says in an interview. “If you take away the incentives, a large portion of these deals would not happen because they are indeed tax-motivated,” says Shay, who left the Obama administration in 2011 and is now a professor at Harvard Law School.e portion of these deals would not happen because they are indeed tax-motivated,” says Shay, who left the Obama administration in 2011 and is now a professor at Harvard Law School.