On February 9, President Obama released the last budget request of his Administration. The FY 2017 budget incorporates many proposals from past years but also looks to cement the president’s legacy with a number of new fiscal policy initiatives in priority areas such as corporate and international tax reform, family and individual tax issues, and energy taxes. These and other proposals are outlined in the Department of the Treasury’s General Explanations of the Administration’s Revenue Proposals (otherwise known as the “Green Book”). This update highlights new proposals in this year’s Green Book and notable changes to provisions included in prior requests.

New Proposals for Tax Reform, Healthcare, and Energy -

Reform the U.S. International Tax System -

Impose a 19-percent Minimum Tax on Foreign Income: The basic concept and mechanics of the FY 2017 proposal remain the same as the FY 2016 proposal. New for FY 2017 is the grant of authority to Treasury to determine the foreign effective tax rate, rather than calculating it by rote based on a 60-month look-back period. The FY 2017 proposal would also make the controlled foreign corporation (CFC) look-through rule permanent. This provision, which was extended in the Protecting Americans from Tax Hikes Act of 2015 for five years, allows a controlled foreign corporation to exclude certain dividends, interest, rents, and royalties in determining its income under Subpart F.