US Tax Reform: A Multilateral Success?

27 Pages Posted: 1 Feb 2020

See all articles by Mindy Herzfeld

Mindy Herzfeld

University of Florida Levin College of Law

Date Written: 2019


The US tax reform passed by Congress in December 2017 constituted a major overhaul of its tax system and of its international tax rules in particular. According to statements made by the administration and members of Congress supporting the law (informally known as the Tax Cuts and Jobs Act), the tax reform had as its primary goal generating domestic economic growth. But lawmakers’ statements also highlight the need for tax reform to protect against erosion of tax revenues through cross-border tax planning. Unlike some other countries’ legislatures, which gave the OECD and its base erosion and profit shifting (BEPS) Project explicit credit in enacting international tax rule changes, the US Congress was practically silent on BEPS as a rationale for the TCJA, and indeed, some members’ statements about the Project were overtly hostile. And yet a number of the anti-base erosion provisions incorporated into the new law are directly traceable to the BEPS Project, and some also serve to protect other countries’ tax bases from profit shifting by multinationals. At the same time, it would be inaccurate to characterise the US international tax reforms as a wholesale adoption of the BEPS recommendations. The multi-faceted nature of the US tax reform—unilateral, focused on local competitiveness, while simultaneously incorporating aspects of the BEPS multilateral project—raises the question of whether it is more appropriate to characterise the reform as a success of multilateralism or vogue unilateralism. The short answer is that it displays aspects of both. The 2017 US tax reform supports the notion that ideas and processes developed as part of multilateral engagement can influence individual country law changes, even when those changes do not explicitly adopt the recommendations reached through multilateral agreement. While the US reform had nothing formally to do with multilateral engagement, it simultaneously may demonstrate that multilateralism can be characterised as a success even when lacking the appearance of it.

Note: This material was first published by Thomson Reuters, trading as Sweet & Maxwell, 5 Canada Square, Canary Wharf, London, E14 5AQ, in the British Tax Review as US Tax Reform: A Multilateral Success?, 2019 B.T.R. 487 (2019) and is reproduced by agreement with the publishers.

Suggested Citation

Herzfeld, Mindy, US Tax Reform: A Multilateral Success? (2019). 2019 British Tax Review 487, University of Florida Levin College of Law Research Paper No. 20-2, Available at SSRN: or

Mindy Herzfeld (Contact Author)

University of Florida Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States

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