At two o’clock in the morning on Saturday December 2, 2017, the Senate took another major step towards accomplishing comprehensive tax reform – on a near party line vote, it passed its version of the most sweeping legislation to overhaul the US Tax Code in a generation. Although Republicans have made significant progress on tax reform – at lightning speed – they still have more work to do before the bill becomes law. This week, House and Senate leaders are expected to begin the process of conferencing their respective versions of the bill. In particular, they will have to reconcile differences between the two Chambers, including the phase-in of the corporate rate, pass-through rates, Byrd-rule compliance, repeal of the Obamacare individual mandate and the mortgage interest deduction (to name a few). With hopes of passing the reconciled bill and getting it to the President prior to December 25, 2017, the GOP could be mere weeks away from securing their long-awaited and hard-fought legislative “win.” (NB: Though we are currently predicting a formalized conference process between the two chambers, the possibility remains that the Senate will simply say to the House, “this is the best we can do – take it or leave it.”)
In our previous alerts, available here and here, we have discussed the substance of the House and Senate bills, respectively. Tax-writers have made important changes since those were published, so, in this alert, we take stock of the latest developments. Below we highlight key aspects of the Senate-passed bill, starting with a brief overview of some domestic provisions, followed by more detailed points applicable to multinationals.