Actions and Detail Panel
The Timing of Tax Transparency
Mon 14 November 2016, 12:00 – 14:00 GMT
'Prof Joshua Blank will discuss his paper, Joshua D. Blank, The Timing of Tax Transparency, 90 S. Cal. L. Rev. ___ (2017)
Fairness in the administration of the tax law is the subject of intense debate in the United States. As recent headlines reveal, the US Internal Revenue Service has been accused of failing to enforce the tax law equitably in its review of tax-exempt status applications by political organisations, the international tax structures of multinational corporations, and the estate tax returns of millionaires, among other areas. Many have argued that greater 'tax transparency' would better empower the public to hold the IRS accountable and the IRS to defend itself against accusations of malfeasance. Mandatory public disclosure of taxpayers’ tax return information is often proposed as a way to achieve greater tax transparency. Yet, in addition to concerns regarding exposure of personal and proprietary information, broad public disclosure measures pose potential threats to the taxing authority’s ability to enforce the tax law.
Given the competing values of accountability and enforcement, what tax return information should be observable by the public? The Article argues that timing matters. The IRS continually engages in enforcement actions ex post, after taxpayers have pursued transactions and claimed tax positions, such as by conducting audits or settlements. But it also frequently engages in actions ex ante, before taxpayers pursue transactions and claim tax positions, by issuing advance tax rulings to and entering into agreements with specific taxpayers. While current law appears to require public disclosure of certain types of ex ante tax administration, many forms of ex ante tax administration remain concealed from public view. The Article argues that documents related to a specific taxpayer’s tax affairs that reflect ex ante tax administration should be publicly accessible as a means of accountability, but that documents that reflect ex post tax actions should remain private in order to preserve effective tax enforcement. Further, the Article proposes that the public should have access not only to ex ante tax administration actions where the taxing authority grants taxpayers’ requests, but also to those actions where the taxing authority denies such requests, even if it does so without issuing an official written determination, a concept it defines as 'dual tax transparency'.
Prof Blank will also discuss the implications of his proposal for other tax jurisdictions, including the United Kingdom.
Lunch will be provided.