Risks ahead: The codification of the economic substance doctrine
On October 4, 2007, the Senate Finance Committee voted 17 to 4 to approve, as part of farm disaster-aid and tax relief legislation, a revised version of the legislative proposal to codify the economic substance doctrine.
The economic substance provision, which has been estimated by the Joint Committee on Taxation to raise approximately $10 billion over 10 years, imposes a strict liability penalty for transactions that fail to meet the provision's definition of economic substance. Accordingly, the provision would significantly increase the risks faced by taxpayers engaging in tax planning with respect to business transactions.
In this podcast, PwC's legislative and regulatory services group partners Brian Meighan, Gray Fontenot, and Ed McClellan share insights into the history of the doctrine, its key features, and an overview of what changes can be found in the Finance Committee's revised proposal. In addition, the panel offers thoughts on the future of the doctrine and the implications it could have on corporate taxpayers on a go-forward basis.
You require Flash player to listen to this Podcast.
*connectedthinking
Download 