Consequential US Rulings to Tax: A Deep Dive Into the Moore & Loper Bright Cases
In this Chambers Expert Focus podcast, Joe Pari, co-chair of Weil, Gotshal & Manges LLP’s tax department, and Devon Bodoh, head of Weil’s international and cross-border tax practice, take a close look at two significant US cases – Moore v United States and Loper Bright Enterprises v Raimondo – and their lasting impact on tax approaches to future business dealings.
In this informative podcast about certain tax rulings in the US, the speakers analyse two significant cases:
- Moore v United States (“Moore”); and
- Loper Bright Enterprises v Raimondo (“Loper Bright”).
Speaking about Moore, Devon Bodoh notes that:
“The decision reaffirms the principle that Congress can attribute a foreign corporation’s income to the US shareholders, and tax them even if their earnings related to that income haven’t been distributed.” (Devon Bodoh, 3:22)
Joe Pari, detailing Loper Bright, says:
“I think Loper Bright is likely to have far-reaching impact on all federal agencies, including [the] Treasury.” (Joe Pari, 12:02)
Moore v United States challenges the constitutionality of the mandatory repatriation tax (MRT), while Loper Bright Enterprises v Raimondo is a landmark decision overruling the decision in Chevron U.S.A. v Natural Resources Defense Council, Inc. et al (“Chevron”). The MRT is a tax on US taxpayers who own 10% or more of a controlled foreign corporation, requiring them to pay a one-off tax on their share of the respective organisation’s past earnings and profits, even if that income was not distributed to them.
Chevron is a decision from 1984 where the High Court ruled that courts must rely on the expertise of regulatory agencies with respect to the interpretation and application of federal laws. The case was focused on the bodies interpreting and applying labour and employment laws, but extended further, including, as noted by Joe Pari in terms of Loper Bright, and, therefore, with respect to Chevron, to the Department of the Treasury.
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