An executive order out of the White House on Friday is setting a stage for the comeback of earnings stripping and corporate inversions.

President Trump on Friday signed an executive order instructing the Treasury Department to find and review tax regulations since the beginning of 2016 and make recommendations on modifying or repealing any they see as overly complex and burdensome. While the White House has not yet indicated which regulations it will seek to target, observers say one major item on the chopping block will be rules to limit corporate earnings stripping brought about under the Obama administration.

Earnings stripping is a technique inverted and multinational companies use to convert U.S. income into foreign income, thus benefiting from lower tax rates abroad. What commonly happens in earnings stripping is that corporations make inter-company loans where the debtor is the U.S. company and the creditor a foreign parent. The U.S. subsidiary pays interest on those loans (and uses those payments to reduce taxable income), and the interest income received by the foreign creditor isn't taxed or is taxed at a lower rate.

The Obama administration in October issued tax rules to curb earnings stripping and inversions. The Trump administration appears poised to change or roll those rules back.

"I think the Obama inversion regulations are most likely to be targeted, notably the earnings stripping rules," said Steve Rosenthal, senior fellow at the Urban-Brookings Tax Policy Center.

New York-based analyst and former Lehman Brothers managing director Bob Willens said the maneuver could save inverted companies a tremendous amount. "Whenever you heard about an inversion and how the tax rate of the combined company was going to be startlingly below what the U.S. company's historically was, that was because of earnings stripping," he said.

A move to scrap Obama-era regulations on earnings stripping might spark another flight of American companies abroad, which runs contradictory to Trump's "America first" message that promises to create jobs and keep American companies at home.

"Ironically, if those regulations were eliminated, which we all expect that they will be...that would encourage inversions, which is arguably contrary to President Trump's America first stuff," Willens said.

The Trump administration could argue that tax reform—namely, lower corporate tax rates and a repatriation holiday—would offset any incentives for companies to leave the United States. But tax legislation is hardly a foregone conclusion out of Washington.

Rosenthal said Trump might be aware scrapping earnings stripping rules without putting broader reforms in place might not look good, which is why he's arguing a review of regulations but not action.

"I think this concern is why Trump ordered a review—to delay actually doing something," he said. "Trump has been ordering a lot of studies recently."

Trump on Friday also signed two memos on financial regulation. One mandates a review of the process for identifying non-bank financial institutions as "systematically important financial institutions" and temporarily halts such designations, and the other puts a temporary stop to the use of "orderly liquidation authority" to unwind troubled financial institutions and calls for a review.

Mnuchin said that Trump is working with Congress to create a comprehensive tax reform package but insisted on sticking to discussions of Friday's executive order, which Trump plans to sign on his first visit to the Treasury Department as president.

"We are going to go through and look at every single significant regulation that has been done in the last year and a half," he said. "We're going to determine whether we think they're needed in the tax code, or whether they're unnecessary and the tax burden and complexity is too much, and if we think it's too much, we will make a recommendation to the president."

When asked whether inversion rules would be on the table, he said, "It's one of the significant things and one of the things we would be looking at."