On 28 March 2022, the Treasury Department of United States published details of tax proposals in the administrationā€™s budget recommendations for FY 2023 in the ā€œGreenBook.ā€ The Greenbook describes following tax measures related to corporate taxation.

  • Raise the Corporate Income Tax Rate from 21 percent to 28 percent.
  • Adopt the Undertaxed Profits Rule
  • Provide Tax Incentives for Locating Jobs and Business Activity in the United States and Remove Tax Deductions for Shipping Jobs Overseas
  • Prevent Basis Shifting by Related Parties through Partnerships
  • Conform Definition of ā€œControlā€ with Corporate Affiliation Test-The proposal would conform the control test under section 368(c) with the affiliation test under section 1504(a)(2). Therefore, ā€œcontrolā€ would be defined as the ownership of at least 80 percent of the total voting power and at least 80 percent of the total value of stock of a corporation. The proposal would be effective for transactions occurring after December 31, 2022.
  • Expand Access to Retroactive Qualified Electing Fund Elections
  • Expand the Definition of Foreign Business Entity to Include Taxable Units