Rocco Femia comments on anticipated efforts in 2013 of U.S. tax policymakers to address concerns regarding base erosion, as well as on the changes to the IRS's administration of its Advance Pricing and Mutual Agreement program.

Femia cautioned that addressing the base erosion concern in a balanced way will not be easy.  "The issues are conceptually challenging, and there generally are not black-and-white answers," he said. "Base erosion will get considerable attention in any corporate tax reform effort, and attention from policy makers is merited. But there are no easy answers here." 

Femia added that the IRS's changes to its administration of the APMA program have had positive results.  "There are some promising signs in terms of the transition to APMA," he said. "Staffing levels have increased, and cases are being worked proactively, particularly competent authority cases." 

Rocco Femia's quotes from this article also appear in BNA's Transfer Pricing Report (January 30, 2013).