ABSTRACT
The repeal of the withholding tax is a measure of substantial technical complexity. It has been characterized by uncertainty on its interpretation and application at all stages of the implementation process. The repeal of the thirty percent withholding tax and the rules issued by the Treasury constitute a very complex body of regulations. Treasury justified its position on the grounds that permitting conversion from registered to bearer form would have vastly expanded the pool of bearer paper available to US tax evaders. The non-convertibility of debt from registered to bearer form decided by the Treasury Department dealt quite a blow to the marketability of bearer Eurobond debt. The tapping of the Eurobond market by the Treasury through issuance of bearer obligations would represent a very inexpensive way to fund the national deficit, given the prime borrower status accorded to the U. S. government by the international financial community.
