A Positive Dialectic: Beps and The United States

Abstract

This essay addresses the interaction between the changes in the international tax regime identified by Mason and U.S. international tax policy. Specifically, I will argue that contrary to the general view, the United States actively implemented the Organisation for Economic Co-Operation and Development (OECD)/G20 Base Erosion and Profit Shifting (BEPS) recommendations through the Tax Cuts and Jobs Act of 2017 (TCJA). Moreover, the changes of the TCJA influenced the current OECD effort of BEPS 2.0. Thus, the current state of affairs can be characterized as a constructive dialogue: The OECD moves (BEPS 1), the United States responds (TCJA), the OECD moves again (BEPS 2). If the international tax regime is to survive, it is important that BEPS 2 will succeed, and that the US will then go along and amend the TCJA accordingly. From this kind of positive dialectic, a new international tax regime fit for the twenty-first century may emerge.