Luxembourg conference on tax cooperation and tax competition

Yesterday I participated in a conference at Luxembourg University's Faculty of Law entitled "Tax Cooperation vs. Tax Competition: Cross-Atlantic Perspectives."

First Tracy Kaye presented a talk on countries' cooperation (or not) with respect to information exchange. The U.S., despite its own efforts pursuant to FATCA, has been notably uncooperative itself with respect to implementing and following common reporting standards (CRS), and these days the odds of FATCA repeal would appear to be higher than those for expanded cooperation.  While Tracy considers repeal unlikely given the huge efforts that went into implementing FATCA and its apparent success in boosting compliance and revenues, the people who will make the call may not care much about any of that.  But said people are probably more likely to be in the Congressional leadership than the White House or Treasury given knowledge and staffing levels in the Executive Branch.

I was the second presenter, and I discussed the EU state aid cases from a mainly U.S. perspective that was drawn to a degree (but not rigidly or slavishly) from my paper on the subject.  I'll post short slides on this after my return to the U.S. in about a week,

The third presenter was Yariv Brauner, who discussed formulary apportionment, as a global option to replace transfer pricing, in light of the U.S. states' experience. They started with the three-factor formula (sales, payroll, property) but have been moving towards sales-only or mostly sales.  Yariv is skeptical that countries will find it in their interests to cooperate very fully, but there is an argument that sales-based apportionment might turn out to be decently incentive-compatible.

Then it was off to Finland (in a resort just outside Helsinki) where I will offer a talk tomorrow entitled "The Rise and Fall of the Destination-Based Cash Flow Tax: What Was That All About?"