Proposed anti-inversion rules by the Treasury entered a White House review on Tuesday and may be finalized shortly, according to officials. The rules are aimed at cracking down on companies that try to circumvent paying taxes by rebasing overseas.
The regulations would make it difficult for U.S. business to avoid paying taxes by shifting profits abroad. Under the new rule, certain interest payments would no longer be tax deductible in the United States.
The rules were received last week by the White House OMB (Office of Management and Budget). The agency will have 90 days to determine whether the regulations should be finalized or reviewed by the Treasury.
The Obama administration has faced harsh criticism for its regulatory attacks on tax inversions. Industry groups have threatened to file lawsuits over the proposed rules, and have called for the regulations to be revised. Critics say the rules may unintentionally harm business.
Some members of Congress have also argued that the Obama administration has overstepped its legal authority.
The regulations were proposed in April along with a rule that prevents serial inversion deals. The serial inversion deal has already been the center of a lawsuit and has not yet been reviewed by the OMB.
A spokesperson for the Treasury said it is “close to issuing final earnings stripping regulations.”