Insights shared at inaugural event

10 June 2016
Neil Buchanan

The New Zealand Centre for Law and Business, in conjunction with Kensington Swan, held the inaugural seminar in its Town & Gown series on 9 May. Professor Neil Buchanan of The George Washington University spoke on the US presidential election, and the implications on tax policy for the US and world economies.

A large audience of over 100 people gathered for the seminar held at the offices at Kensington Swan. The managing partner of Kensington Swan, Anthony Drake introduced the seminar and acknowledged the presence of the patron for the New Zealand Centre for Law and Business, Sir Peter Blanchard, before introducing Professor Buchanan.

The scenario presented by Professor Buchanan is a bleak one in terms of US politics and tax reform. In his view it appears highly likely that there will be a continuation of the stalemate in the balance of power between the US political parties, irrespective of the presidential election. As a result he predicts a continuation of the US Government’s inability to deal with major tax reform propositions in a coordinated way.

The impact on New Zealand and the rest of the world is significant because it is unlikely that the US will be able to achieve significant international tax law reform. This may mean a continuation of the existing situation for US multinational corporations with the implication that has on these company’s Base Erosion and Profit Shifting activities in respect of the operations of their US controlled subsidiaries. Under existing rules US multinationals are incentivised to pay little tax in a jurisdictions outside of the US.

On behalf of the hosts, the New Zealand Centre for Law and Business and Kensington Swan, Ian Kowalski provided local comment as he compared some of the political conditions to the New Zealand market place.

Professor Craig Elliffe, Director of the Centre, thanked Kensington Swan for its generous involvement in this new initiative which bought together practitioners, academics and students in an energetic and enjoyable discussion.