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of the regulatory authority in section 931(d)(2). The 1986
Senate Finance Committee report provides as follows:
An individual who is a bona fide resident of Guam,
American Samoa, or the CNMI during the entire taxable
year is subject to U.S. taxation in the same manner as
a U.S. resident. However, in the case of such an
individual, gross income for U.S. tax purposes does not
include income derived from sources within any of the
three possessions, or income effectively connected with
the conduct of a trade or business by that individual
within any of the three possessions. * * *
S. Rept. 99-313, supra at 480, 1986-3 C.B. (Vol. 3) at 480. This
language shows the legislative assumption that the exclusion
would take effect independently of the issuance of Treasury
regulations. The dissent’s view that the exclusion has no effect
absent regulations creates an unnecessary conflict between
section 931(a) and (d)(2). See FDA v. Brown & Williamson Tobacco
Corp., 529 U.S. 120, 133 (2000) (courts must interpret a statute
to “fit, if possible, all parts into an harmonious whole”,
quoting FTC v. Mandel Bros., Inc., 359 U.S. 385, 389 (1959)).
Second, the legislative history states (and illustrates with
examples) that the purpose of the regulatory authority is to
prevent abuse under the mirror system of taxation. See S. Rept.
99-313, supra at 481, 1986-3 C.B. (Vol. 3) 481. The Senate
Report states:
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