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I. INTRODUCTION: WHO WAS STANLEY SURREY?
Many younger U.S. tax practitioners and academics may have never heard of Stanley S. Surrey. Older ones know that he was arguably the most important U.S. tax academic and one of the most important U.S. government tax officials of the twentieth century. But even people knowledgeable about Surrey mostly associate him with the tax expenditure budget, which is still a controversial subject.1 This paper will argue that while Surrey was undoubtedly the creator of the concept of tax expenditures, his influence was more far-reaching than that. Surrey invented the ideal of tax reform as a base broadening, rate cutting measure which every subsequent effort to reform the tax Code up to and including the Tax Cuts and Jobs Act of 2017 (TCJA) is measured against.2 And this was not even his longest lasting contribution to tax law. We will argue that Surrey's most lasting contribution was his articulation and implementation of the single tax principle in international taxation, which underlies both the current international efforts to curb base erosion and profit shifting (BEPS) and the international aspects of the TCJA.3 While the tax expenditure budget is controversial and may not have much of an impact in practice, and the ideal of tax reform as base broadening and rate cutting had its apogee in 1986, the single tax principle is only in the process of being fully implemented now, in the early 21st century, more than thirty-five years after Surrey's death.
Stanley Sterling Surrey was born to a Jewish family in New York City in 1910. He attended the City College of New York, from which he graduated magna cum laude in history at age 19 just as the Great Depression was about to begin, and then Columbia Law School.4 As he explains in his unpublished memoir, in law school he happened upon tax as a subject because he liked his Civil Procedure teacher, Professor Roswell Magill, “a dry, taciturn person who moved through the course in a most methodical fashion.” 5 Magill complimented Surrey on an assignment, and this made Surrey take his elective class on taxation in his second year. As Surrey writes:
Somehow or other, I had come to like this astringent...