Companies don’t believe broad-based tax reform is coming anytime soon, though they do think that the change of control in Congress will have a significant impact on tax policy, according to a survey conducted by a Washington law firm.

Miller & Chevalier’s 2007 Tax Policy Forecast Survey was distributed in January to tax and finance executives at Fortune 100 companies and U.S.-based multinationals. The survey was completed by 130 respondents.

Survey findings included that:

  • A majority of respondents (68 percent) believe the Democratic takeover of Congress will have a significant impact on tax policy for business. Of those respondents, 83 percent think that impact will be unfavorable to domestic business, while 90 percent think it will be unfavorable to international business;
  • More than half of all respondents (56 percent) think the change of control in Congress will have a significant impact on their business;
  • Manufacturers are the least concerned about the impact of the change in Congressional control on their business (42 percent) while oil and gas (80 percent) and financial services (79 percent) respondents are more worried than the respondents as a whole; and,
  • ƒnWhile most respondents think Congress will look towards codification of the economic substance doctrine (65 percent) and taxation of international operations (62 percent) for additional tax revenue, only 9 percent and 28 percent, respectively, said that such changes would have the most unfavorable impact on their business.

The law firm did not that many of the legislative proposals floating around Washington were broad and that businesses may not fully understand the scope of what day-to-day transactions could potentially be affected.The full survey results are available at www.millerchevalier.com.

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