While no one can predict the future, Accounting Today’s senior tax editor Roger Russell covered the 2017 Outlook produced by Bloomberg BNA’s Daily Tax Report.
George Farrah of Bloomberg BNA stated that “2017 will be a milestone year for tax policy.” He predicts that the changes will impact every area of taxes:
- State tax policies and laws
- The potential elimination of some major tax regulations
- The likelihood of Obamacare being repealed
- An overall of the tax system
Farrah also commented that the entire federal tax code could be rewritten. He thinks that certain changes are particularly likely to happen:
- IRS restructuring
- Shift towards a territorial tax system
- Estate tax repeal
- Tax rate changes
- Elimination of the corporate minimum tax
The impact on tax professionals will be especially strong, since there will be changes in the partnership audit rules.
International tax law is highly likely to be affected according to Farrah. With the large amount of money being held offshore, a one-time repatriation would bring a lot of money back into the US. He states that there is a “growing consensus” to prevent companies from relocating in other countries by changing the tax laws.
The report states that it is likely that the budget of the IRS will be “miserable” in 2017 and beyond. The agency is short 5,000 criminal investigators and revenue agents compared to six years ago. In fact, the commissioner of the IRS warned that agency could fail without more funding.
The uncertainty will affect state and local governments which are struggling with applying tax laws to emerging technologies. New platforms such as Uber and Airbnb are likely to see strong scrutiny from states that are seeking additional revenue sources.
With the lack of guidance from the feds, there is a high level of uncertainty. Farrah predicted that further inaction by Congress will mobilize more states to adopt remote sales taxes in 2017.
The only thing for certain is that the status quo will not be the same after 2017.