On 5 September 2018, the United States (US) Treasury and the Internal Revenue Service (IRS) released a draft of Form 8991 concerning the “base erosion and anti-abuse tax” (BEAT) reporting for 2018.

In an effort to ” level the playing field between US-based parent companies and foreign-domiciled parent companies,” the new US Tax Code (Pub, No. 115-97 of December 22, 2017) made a new base erosion-focused minimum tax—the base erosion and anti-abuse tax (BEAT)- which in many cases would severely restrict the US tax advantage of cross-border related party payments by large multinationals. The BEAT includes within its scope almost every outbound payment made by corporations subject to the rule, except for payments treated as costs of goods sold (COGS) or otherwise as reductions to gross receipts subject to regulatory authority from the Treasury Secretary for anti-avoidance regulations.