Execs Foresee Tax Reform in 2017

The year 2017 is expected to be the time when Congress will finally enact tax reform, according to a new poll.

Ernst & Young’s latest monthly Tax Reform Business Barometer polled approximately 1,000 business executives, including tax directors and government relations executives, last month. They continue to believe that tax reform will occur within the next several years, with a 63 percent likelihood that tax reform will happen in 2018 or earlier. However, EY found the percentage has fallen slightly over the past year, with respondents giving a likelihood of 67 percent in June and 73 percent in January that tax reform will happen in 2018 or earlier.

The September edition of the Barometer indicates that 2017 remains the most likely year for tax reform with respondents assigning a 28 percent likelihood, which is consistent with responses of a 31 percent likelihood in June and a 33 percent likelihood in the January edition of the survey.

Approximately 16 percent of the survey respondents think tax reform will affect only corporations, while 21 percent believe it will include all businesses, including pass-through entities, 19 percent anticipate it will be international-only, and 45 percent think the tax reform will be comprehensive. EY noted this is almost unchanged from the June 2015 Barometer, which found 16 percent of the respondents thought tax reform would affect only corporations, 22 percent predicted that reform would involve all businesses including pass-throughs, and 40 percent believed tax reform would be comprehensive. No respondents expected tax reform to affect only individuals in the September, June or January editions of the Barometer.

Asked about the recent interest in international-only tax reform, 35 percent of the respondents indicated the enactment of such reform would increase the likelihood of enactment of a more comprehensive tax reform at a later date, while 65 percent believe it would hinder eventual enactment of comprehensive tax reform.