(Sanitized) TAXES AND SECTION 911 OF U.S. INTERNAL REVENUE CODE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75-00793R000300060018-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 2
• Document Creation Date: December 16, 2016
• Document Release Date: October 1, 2004
• Sequence Number: 18
• Publication Date: August 20, 1973
• Content Type: MF

Approved For Relea; 2004/11/01 : CIA-RDP75-00793R0004p060018-2
20 August 19+ 3
MEMORANDUM FOR: SA/Facilities, Planning & Liaison/
Special Systems Division/OEL
Taxes and Section 911 of
25X1A
U. S. Internal Revenue Code
25X1A
25X1A
1. The following should help you to respond to
25X1A
Paragraphs 4 and 5 of that cable point out that the sure-
they will remain exempt under Section 23AA of the tax 25X1A
law.
fire solution to thel ax problem created by their re-
peal of the Section 160.ABA concession to certain foreign employees
is to keep U. S. contractor employees taxable in thQ U.S. so t tat
2. Repeal of Section 911 of the Internal Revenue Code on
would be im- 25X1A
the basis of this pa. r ocular problem in
i 1
possible. The Office of International Operations of the IRS advises
us that approximately 112, 000 individuals took advantage of Section
911 in 1972. It is an important exemption not only to this large
number of Americans residing abroad, but also to hundreds of
American businesses having employees residing in almost every
country in the world. Many of these are large and influential
companies. The Section 911 tax exemption is both an incentive
to their employees and in many cases, an indirect saving to the
companies.
25X1
Approved For Release 2004/11/01 : CIA-RDP75-00793R000300060018-2
 Approved For Relea.2004/11/01 : CIA-RDP75-00793R0003000060018-2
3. Repeal., or more likely: modi ication of Section 911
is a possibility by the end of 1974. The House Ways and Means
Committee has before it tax reform legislation. This will come
up for active consideration either this fall or next spring. There
will be proposals for repeal or modification of Section 911. How--
ever, as noted above, American businesses and in particular, the
multinational companies will be opposed to repeal or substantial
limitation of it. Whether Congress gets to tax reform legislation
this session and how far they go with it particularly in relation-
ship to foreign source income will depend. to some extent on
progress with foreign trade legislation which is also before the
Ways and Means Committee, and which will be given priority.
At the moment an educated guess would be that there is a fair
chance of some reform of Section 911 but that repeal is unlikely.
There is no way at this time to tell what reforms might be made
and how th v uld affect the taxability of Americans working and
residing i
ffic. of Legislative
OGC cap
Original - Addressee
C,
0 U C'' '
11
mi'l' - FE RAL TAXES
1 -igner
1 - Chrono
25X1A
n r i _ "
Approved For Release 2004/1 ;-I14-Hbl 75-00793R000300060018-2