Project Finance NewsWire

August 2004

IN THIS ISSUE

Ethanol: Wall Street Meets Main Street

The ethanol industry is in a period of extraordinary growth that is in large part driven by a ban on methyl tertiary-butyl ether, or “MTBE” — an ethanol substitute — and the availability of tax su...

The Distressed Projects Market

One topic this year at a conference Chadbourne hosts annually for leaders in the energy industry was the state of the distressed projects markets in the United States...

European View of the US Market

Another topic at the Chadbourne conference this year was what opportunities Europeans see in the US market, what they are telling their managements about the uncertain US regulatory climate, and h...

Opportunities in the Tightening Gas Market

Daniel Yergin and Michael Stoppard wrote recently in “The Next Prize” about an emerging natural gas shortage in the United States and the growing dependence of gas-consuming countries on a small n...

Still Feeling Burned About Foreign Markets

US power companies made a push overseas starting in the early to mid-1990s as the opportunities to grow abroad looked more promising than what was by then a crowded US market...

Renewables: Best Bet For Growth

The Global Windpower 2004 conference this year in Chicago attracted 3,000 people. However, the wind market has remained slow this year because a production tax credit of 1...


IN OTHER NEWS

Synfuel

SYNFUEL plant owners face another round of trouble with the Internal Revenue Service.

Corporate Restructurings

Corporate restructurings are on hold while companies wait to see what Congress does with a provision in a pending tax bill...

Foreign Electricity Sales

Foreign electricity sales must be registered as potential corporate tax shelters, the IRS said. The result was not intended, but the agency said that is what its rules require...

A power contract

A POWER CONTRACT buyout payment had to be reported by the generator as ordinary income rather than capital gain, the IRS said.

Solid Waste

Solid waste remains a debate topic. Witnesses at an IRS hearing in early August criticized the tax agency for a proposal it made in May to change how “solid waste” is defined for tax purposes...

A Foreign Tax Credit

A foreign tax credit strategy is being challenged by the IRS. Guardian Industries is a US-based manufacturer and distributor of glass products...

Argentina

ARGENTINA is moving to encourage a domestic ethanol industry.

Peru

PERU imposed a new mining tax in early June. The rate is 1 to 3% of gross sales. It is 1% for companies with gross sales of less than $60 million. Companies with gross sales of more than $120 million pay 3%.

Brazil

BRAZIL said that it will not collect withholding taxes on interest that Brazilian companies pay to foreign lenders on certain outstanding loans.

Indonesia

INDONESIA formally cancelled its income tax treaty with Mauritius on June 24.

Federal Grants

Federal grants that are spent on elevating homes and protecting other properties against possible floods must be reported by property owners who benefit from them as income, the IRS said in an int...

Undivided Interests

Undivided interests are getting another look from the IRS. Nuclear power plants are usually owned by a group of utilities, each of which takes a share of the electricity in kind...

Credit Default Swaps

Credit default swaps are also under study by the IRS. They raise difficult US tax issues...

Highway Use Taxes

Highway use taxes must be paid on special trucks that utilities use to plant poles and make other repairs, a US appeals court said in July...

Serbia

Serbia revamped its tax system in late July...

Turkey

TURKEY is hoping to become a base for offshore holding companies making investments in the Balkans, central Asia and the Middle East.

Israel

Israel is reducing its corporate tax rate from 36% to 30% in stages between now and 2007. The Knesset approved the reduction on June 29...

Partnerships

PARTNERSHIPS sometimes play games to get more “outside basis” to one of the partners.

Minor memos

The Nevada governor proposed to state regulators in July that the state collect a temporary surcharge on electricity bills ...