22 November 2017

 

The Honorable Orrin Hatch

Chairman

Senate Finance Committee

Washington, D.C. 20510

 

Dear Chairman Hatch,

 

On behalf of the Asia-Pacific Council of American Chambers of Commerce (APCAC), I write in sincere support of you and your colleagues’ ongoing efforts to modernize the U.S. tax code to meet 21st century demands and realities.  APCAC strongly endorses the proposal, among others, to shift to a system of territorial taxation for corporations.  However, at such a critical juncture, more can and must be done to ensure that tax reform reaches its maximum potential.  Specifically, as the Administration and Congress consider a territorial tax system for U.S. corporations, a territorial tax system for individual taxpayers should also be adopted. This will reduce confusion between the two systems, level the competitive playing field, promote exports and American entrepreneurship, and create more investment and jobs for U.S. companies and citizens.

 

Representing 29 American Chambers of Commerce across 22 economies around the Asia-Pacific, APCAC sits on the frontlines of commercial diplomacy in the region. As such, our members have firsthand experience and keen insights into the competitive challenges facing American corporations and American citizens living and working in the Asia-Pacific.  Certainly, companies and individuals face unique sets of challenges in the global marketplace. However, the U.S.’s worldwide system of taxation directly impacts the competitiveness of both. Therefore, it is confusing, and at times frustrating, that so much attention is focused on bringing the tax code into the 21st century for American business – primarily via the shift towards a territorial tax regime – but not for hardworking American citizens abroad.  Only the U.S. and Eritrea currently tax their citizens abroad – a reality that deeply disadvantages American workers against their counterparts from literally every country in the world. Noting the Finance Committee’s recognition of these frustrations,[1] this disparate treatment only promises to sow further confusion in an already complex system and undermine the overarching policy goal of spurring American innovation and growth both domestically and abroad.

 

Part of the challenge for Americans living and working abroad is the un-level playing field they face when competing for jobs with their foreign competitors. Specifically, companies must pay a premium to hire American workers in order to ameliorate the additional tax obligations arising from the U.S.’s worldwide system of taxation. The result is an un-level playing field as American citizens compete for jobs, including at U.S. companies, with foreigners who are less expensive to employ. And not surprisingly, the impact has been and continues to be a reduction in the number of American citizens in key management positions – a fact evidenced by many AmChams in the region not even having enough Americans to fill their board.  Not only does this diminish American leadership and influence in the Asia-Pacific, it also impacts the natural procurement ties to U.S. goods, which is a key consideration in addressing ongoing trade deficits with many countries in the region.

 

APCAC believes that the most prudent path forward is through harmonizing the tax treatment between corporations and individuals vis-à-vis a shift to territoriality. As discussions continue, APCAC and all of its members look forward to staying engaged with you and your colleagues on these important issues impacting American citizens living and working overseas.

 

Finally, do not put this important issue off to a future tax effort. APCAC has been advocating for territorial treatment of American citizens abroad for nearly fifty years and we must not miss this current opportunity to solve this important issue.

 

Please be assured of our best wishes and warmest personal regards.

 

[1] The Finance Committee’s International Working Group report highlighted that over 7.6 million American citizens are currently living abroad and that nearly three-quarters of the 367 submissions made to the international work group focused on the tax treatment of these individuals – specifically citizenship-based taxation, the Foreign Account Tax Compliance Act (FATCA), and the Report of Foreign Bank and Financial Accounts (FBAR). The report went on to provide an overview of these topics, but does not offer a comprehensive plan or specific proposals for overhauling the taxation of individual Americans living and working abroad, although it stated the Committee would “carefully consider the concerns articulated in the submissions moving forward.”

 

Sincerely,

 

 

Read the letter here.

AmCham Singapore continues to lobby for better taxation policy for both American workers and American companies, and is working closely with APCAC leaders to advocate for a territorial tax system. Speaking on the floor of the U.S. House of Representatives recently, Representative George Holding (R-NC) voiced his support for residence-based taxation: “I […] support this historic bill that will put our economy back on the path to stable and sustained growth. This bill finally levels the playing field and restores the global competitiveness of American businesses by moving to a territorial system.”

 

Championing the cause, Ways & Means Committee Chair Representative Kevin Brady (R-TX) reiterated support, saying that “Residence-based taxation is an idea we should continue to explore. We’ll continue to work on this issue […].”

 

Click here to view the video.

 

SME’s we want to hear from you!

 

Please help us understand how we can better serve the SME community within AmCham Singapore.

 

The results of the survey will help us decide on future programming, engagement, and advocacy issues.

 

Click here to take this short survey. It only takes 2-3 minutes!

 

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The American Chamber of Commerce in Singapore (AmCham SG) is pleased to announce the appointment of Ann Yom Steel as Executive Director. Steel assumed her role – ensuring the chamber maintains its instrumental position in representing U.S. business and promoting members’ continued success and leadership in Singapore and the region – on September 1, 2017.

 

Steel brings with her a wide breadth of public and private sector experience. She joins AmCham Singapore following her most recent post as Head of Strategic Planning for the International Rice Research Institute (IRRI) headquartered in the Philippines where she led the development of the organization’s 10-year global strategy. Prior to her role at IRRI, Steel resided in Singapore and was the Director of External Affairs and Head of Global Partnerships at the Lee Kuan Yew School of Public Policy.

 

Further bolstering her public policy credentials, Steel also served as Associate Director of Public Affairs for Ogilvy Public Relations in Sydney, as well as Deputy Director for Office of State, Local, and Tribal Coordination at the U.S. Immigration and Customs Enforcement (ICE). Prior to joining ICE, Steel worked as a political and legislative advisor to a U.S Senator and as chief lobbyist and spokesperson for a number of national associations in Washington, DC.

 

See full press release here.

 

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AmCham Singapore issued a statement on August 25 urging the eleven members of the TPP to reach a successful conclusion to ongoing deliberations and implement this high-standard agreement as soon as possible.  AmCham Singapore believes the TPP as negotiated provides the foundation for implementing the high standards needed to further economic growth and development in the Asia-Pacific region and represents the future of sustainable international trade.

 

“As Singapore serves as America’s business headquarters for Asia, we see first-hand many competing frameworks for creating the architecture for trade in the region, such as the Regional Comprehensive Economic Partnership,” said Dwight Hutchins, Chairman of AmCham Singapore.

 

“The TPP is, by far, the best and most strategic trade framework from a business perspective – even without the U.S. government in it – as the high standard elements within it are supportive of U.S. businesses,” said Steven Okun, Chairman of the AmCham Singapore TPP Task Force.

 

Not only does the TPP-11 provide duty-free access to its members for nearly all goods and all manufactured goods, it also dramatically opens-up opportunities for the flow of services and investment sectors. It enhances protections for intellectual property rights, promotes cross-border data flows, ensures fair competition by state-owned enterprises, and provides new opportunities for many government procurement contracts. Beyond any other trade agreement, it also includes unprecedented protections for the environment and labor.

 

See full press release here.

The American Chambers of Commerce in Australia and Singapore jointly affirm that both the respective U.S. FTAs associated with their countries benefit U.S. business and workers across each of their individual markets. Furthermore, in comments submitted to the U.S. Department of Commerce and the office of the U.S. Trade Representative, both Chambers agree that the U.S. government should build upon the successes of these agreements by entering into a multi-party agreement in the region.

 

This is particularly true given that Australia and Singapore continue to look to enter into the TPP without the U.S. If this were to occur, this could place U.S. companies and industries at a competitive disadvantage. The U.S. must find a way to engage both bilaterally and plurilaterally, or U.S. businesses and workers will risk falling behind.

 

To read the full paper, click here.

In response to Executive Order Regarding Trade Agreements Violations and Abuses, we at AmCham agree with Deputy National Security Advisor K.T. McFarland’s characterization of the Singaporean-American “economic relationship [as] robust.”

 

We at AmCham Singapore believe that a strong economic relationship between the U.S. and Singapore as outlined in the U.S. Singapore Free Trade Agreement (or USSFTA) has and will continue to benefit both countries. The USSFTA has become a framework for providing business opportunities, standardizing regulatory environments, and promoting innovation.

 

To read the full paper, click here.

K.T. McFarland, nominee to be U.S. Ambassador to Singapore, testified before the Senate July 20, 2017.

 

McFarland began by thanking her endorsers, namely Dr. Henry Kissinger, Secretary of State and National Security Advisor under the Nixon and Ford administrations; General H.R. McMaster, current National Security Advisor; and President Trump.

 

McFarland’s diplomatic strategy was outlined by three points of focus: first, the strong economic relationship between Singapore and the U.S.; second, the strong security alliance between the two countries; and third, similarities between both countries in government, demographics, and economies.

 

To read McFarland’s full testimony, click here: https://goo.gl/QiHsT7

In recognition of ASEAN’s 50th anniversary, this year’s ASEAN Business Outlook Survey (ABOS) will feature enlarged country-specific sections, much like the infographic below. It will include articles highlighting the work of AmCham member companies throughout the region such as CEO interviews, an SME roundtable, and a CSR overview.

 

To find out more, click here to read the ASEAN Business Outlook Survey published by AmCham Singapore!

 

MALAYSIA ABOS 2017

 

This year’s ASEAN Business Outlook Survey (ABOS) will feature enlarged country-specific sections, much like the infographic below. It will include articles highlighting the work of AmCham member companies throughout the region such as CEO interviews, an SME roundtable, and a CSR overview.

 

To find out more, click here to read the ASEAN Business Outlook Survey published by AmCham Singapore!

 

LAOS ABOS 2017_edit