Professor Stephen Shay served as deputy assistant secretary for international tax affairs at the Treasury.
Professor Stephen Shay testified before the Homeland Security & Governmental Affairs Permanent Subcommittee on Investigations in September. The topic of the hearing was “Offshore Profit Shifting and the U.S. Tax Code.” The subcommittee examined the shifting of profits offshore by U.S. multinational corporations and how such activities are affected by the Internal Revenue Code and related regulations. Shay, who most recently served as deputy assistant secretary for international tax affairs at the Department of the Treasury, provided background information on the taxation of foreign income of U.S. multinationals earned through a controlled foreign corporation and transfer pricing. He said, “Until there is evidence that the gusher of profit shifting through transfer pricing has been capped in some way, it is risky, even foolhardy, to consider shifting to an exemption system and inviting additional businesses to the income shifting trough.” Other witnesses included Reuven S. Avi-Yonah ’89, a professor at the University of Michigan Law School, and William J. Wilkins ’77, chief counsel of the Internal Revenue Service.