President Trump’s first 100 days in office have included important policy announcements which could have significant implications for south west businesses RSM has warned.
Among the key issues facing local businesses with transatlantic operations are:
Tax – in a major announcement on 26 April, the Trump Administration announced its intention to reduce the US business tax rate to 15 per cent, introduce a territorial tax system to level the playing field for American companies, bring in a one-time tax on overseas profits and to eliminate tax breaks for special interests. However, a border adjustment tax which would have affected UK exporters appears to be off the table for now.
Immigration – Reports suggest that the flow of immigration, both legal and illegal, to the US has already reduced since President Trump took office. Of particular concern to UK businesses is the ‘Buy American and Hire American’ executive order which seeks to reform the employment-based visa system. The reforms are designed to help ensure that employment-based visas are ‘awarded to the most skilled or highest-paid beneficiaries’. This measure could impact the ability of UK companies to send employees to work in the US.
Commenting on President Trump’s first 100 days in office, Matthew Sewell a tax partner at RSM in Bristol said:
‘Understandably, south west businesses who trade with the US or who have transatlantic operations are keen to understand the implications of the new Trump Administration’s policies.
‘We have just learned details of the principles underpinning the Administration’s tax reform programme which is described as one of the biggest tax cuts in American history. While there are significant changes planned for the federal business tax rate, for now at least, the proposed border adjustment tax which would have affected UK companies exporting to the US has been shelved. However, given the potential costs of the tax cuts being proposed, we can expect some significant wrangling in Congress before these reforms reach the Statute Book.
‘President Trump has also shown his determination to address what he perceives to be problems and weaknesses within the US immigration system. Businesses across the region will need to understand how this might affect intra-company secondments and business travel between the UK and the US and to plan accordingly.’
RSM will be hosting an event in Bristol on 11 May to help businesses operating in the US to understand and plan for the impact of US tax and immigration policies.