Any legislation granting a projected $148 billion in tax relief directed primarily to U.S. businesses is bound to spur lively debate, and the recently passed American Jobs Creation Act has done exactly that.

We have heard from some quarters that the measure — signed into law Oct. 22 by President George W. Bush — will live up to its name and foster the creation of more jobs for American workers. Others insist it will put more ready cash into the hands of corporations to use for ill-defined purposes. One camp characterizes the changes to the tax code as reform; another sees increased complication.

We hear cautionary tales that retailers and restaurant chains are trying to figure out how to join the makers of bows and arrows, producers of drinking water and Native American whaling captains in the suddenly favored manufacturing class.

If confusion is the proverbial first step to knowledge, we must all be geniuses.

Some level of confusion and debate is to be expected with a bill of this magnitude — a hefty 650 pages, addressing a wide swath of industries. If prior major tax legislation is any guide, affected taxpayers will be seeking guidance from all the appropriate authorities for some time to come.

After all, a sea change has occurred within the American tax system. And, like the Tax Reform Act of 1986, the impact of that change will take months — and in some cases years — to work its way through the system and be fully understood or measured.

One provision has the potential to affect the financial and competitive position of corporate America significantly. The act provides a limited opportunity for U.S. companies with foreign subsidiaries to repatriate some earnings that have been held abroad at a favorable tax rate. The question is whether the repatriated funds, estimated by some media reports to total as much as $500 billion, will provide the impetus for increased investment in plant and equipment, research and development, and job retention and creation that its proponents have claimed.

The answer to that question will significantly affect the uses to which the funds may be put and may well affect the amount that will be repatriated.

It will be interesting to see which companies more effectively utilize this provision to improve business performance and strengthen market position. In this environment of heightened corporate transparency, it’s clear that, either way, the investment decisions will be studied by key stakeholders and industry analysts, who will declare winners and losers.

The American Jobs Creation Act ballooned beyond its original scope to embrace an array of tax benefits for almost every corner of the business landscape. Now we’ll await the effects of implementation with the hope that the objectives of the legislation can be achieved.

Randall Hamilton is a lead tax partner at KPMG L.L.P.

The Des Moines Business Record seeks to publish opinions about issues that are important to the economic climate of Central Iowa. To submit a guest opinion piece, contact Managing Editor Jim Pollock by e-mail at jimpollock@bpcdm.com or by phone at 288-3338, ext. 241.