The Beat and Treaty Overrides: A Brief Response to Rosenbloom and Shaheen

Document Type

Article

Publication Date

2018

Abstract

In a recent paper posted on SSRN, Profs. David Rosenbloom and Fadi Shaheen argue that the Base Erosion Anti-Abuse Tax (BEAT) (IRC section 59A), as enacted in 2017, is a potential violation of Articles 23 and 24 of US tax treaties. In addition, they argue that the BEAT does not override those treaties and therefore the treaties can be relied upon to overcome the effects of the BEAT. In our opinion, this conclusion is wrong, for two reasons. First, we believe that the BEAT is not a treaty violation. Second, we believe that even if the BEAT were found to violate treaties, it is a treaty override.

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