|Robert Stack was
also in the Global Tax 50
Robert Stack's influence in international tax affairs has
ensured his spot in the Global Tax 50 for a third year running.
For the US, this year has been rife with international tax
matters – most notably when the US said that the
European Commission was unfairly targeting American companies
such as Apple, Amazon, Starbucks and McDonalds through state
The growing US-EU tension has meant that Stack has been
busy. However, Stack will not be continuing in his position at
the Treasury for much longer. In a phone interview, Stack told
International Tax Review that he would be stepping
down from his role to pursue new opportunities. Here, he talks
about the BEPS Project, country-by-country reporting (CbCR),
state aid, the election and international tax reform.
International Tax Review: 2016 has been a busy year
for international taxation. What have been some key themes on
your agenda throughout the year?
Robert Stack: I think one of the first
important things was the implementation of the BEPS Project.
The US is very proud to have met all the minimum standards
proposed as part of BEPS. We have implemented
country–by-country reporting in a timely manner; our
treaties already include the strongest anti-treating shopping
provisions in the world; we lead in satisfying the mutual
agreement procedure standard; the US has no harmful practices
and has agreed to automatically exchange rulings that affect
ITR: Regarding CbCR, the US's implementation of it
has been an important step in tax transparency efforts. What is
your deposition on public CbCR?
RS: The Treasury department was most
disappointed when the European Union (EU) member states agreed
in the BEPS Project to country-by-country reporting among tax
authorities and then proposed to make it public. The ink wasn't
dry on the BEPS recommendations before certain elements at the
EU proposed walking away from the multilateral agreement to
suggest that this should be done on a public basis. We are
concerned about the degree to which EU member states are
actually committed to multilateral processes in the
international tax space; actions like this raise serious doubts
as to whether they are.
ITR: You once said that a major driver of the BEPS
Project is to attack US multinationals. Revisiting this, has
your opinion changed?
RS: There was always a concern that in
working on the BEPS Project we protect the US tax base and that
US companies not be disproportionately targeted and affected by
BEPS. That being said, there were lots of good elements in the
BEPS Project that are going to help the world. While I thought
it was important for us to aggressively protect the US tax
base. I think we were able to constructively lead to solutions
that will improve international taxation - and we did that on a
ITR: Just revisiting the state aid topic, can you
tell us a bit about what the US is doing in light of these
RS: We are very proud of our work in
pointing out the inconsistencies taken by the European
Commission (EC) with respect to the state aid decisions and the
degree to which they are a dangerous precedent for the
multilateral development of international tax policy. We issued
a White Paper in August and the Secretary has continued to
state that the EU is retroactively applying a sweeping new
state aid theory that is contrary to well established legal
principles, calls into question the tax rules of individual
countries and threatens to undermine the overall business
climate in Europe.
ITR: Let's talk about the US election. What are the
most prominent tax implications of a Donald Trump presidency?
What changes can businesses expect?
RS: President Obama proposed a business tax
reform plan in 2012, which was recently updated in April; the
President-Elect has a different approach; the Senate Finance
Committee has suggested an approach; and the House Ways and
Means Committee in June put out a Blueprint outlining its
approach. Each is different from the other. I think it will be
up to the next administration and the next Congress to sort
through the differences.
ITR: Is it fair to say then that there will most
likely be a major tax reform in the New Year?
RS: There's a strong desire within the
United States to move forward on business tax reform, which
this administration has made substantial progress on.
ITR: What do you think still needs to change in
relation to US tax reform and international tax
RS: I think that, and this is something I
think we missed in the BEPS Project, there needs to be stronger
controlled foreign corporations (CFC) rules. The reason that
these are important is because the international system needs a
greater degree of stability so that companies can work with the
certainty of what their tax rates will be around the world. I
think a question that will linger in the international tax
community on into the future is: are we building a stable
system or are we just fostering tax competition among residence
countries, which has deep stabilising affects throughout the
rest of the international tax system?
ITR: What work in international taxation would you
say are you most proud of?
RS: The United States is proud of the fact
that we took a leadership role in the OECD's BEPS Project. I
think we have one of the best technical tax teams in the world
and I think we apply that skill and knowledge to international
taxation, we left our imprint on virtually every action item in
a way that improved the quality of the work and we are very
proud of that.