WASHINGTON (Reuters) – Global banks raised concerns on Friday over a provision in the U.S. Senate tax bill aimed at cracking down on tax avoidance by multinational corporations that they said could hurt the banking industry.
Banks initially looked to be one of the major winners of Republican lawmakers’ efforts to overhaul the U.S. tax code, and publicly they have been very supportive.
But two bank trade groups noted in a letter to the Senate Finance Committee that a provision to fight tax dodging by multinationals could ratchet up the cost of providing risk management services to Main Street companies, causing market disruption.
The letter, seen by Reuters, was sent by the International Swaps and Derivatives Association and the Securities Industry and Financial Markets Association, whose members include the likes of Goldman Sachs Group Inc, Morgan Stanley, Citigroup Inc and JPMorganN>.
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The Senate Finance Committee approved the bill containing the provision late Thursday, and will send it on to the full Senate for a vote in the coming weeks.
The U.S. House of Representatives approved its version of tax legislation the same day, potentially setting the stage for the two to hammer out a compromise bill as soon as December.
Republican Senator Orrin Hatch, the finance committee chairman, and Ron Wyden, the ranking Democratic member of the committee, did not immediately respond to requests for comment.
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