Older power plants under siege for air emissions
A group of utilities failed in a last-minute bid in November to persuade Congress to freeze the penalties that they might be found to owe the federal government for violating federal Clean Air Act...
US Tax Laws Change — Again
Congress voted a number of tax law changes in late November that will affect the project finance community...
IRS Moves To Limit Certain Foreign Tax Planning
The Internal Revenue Service proposed changes in its “check-the-box” regulations on November 26 that would rule out two foreign tax planning techniques that have been used by the project finance c...
New Insurance For Capital Markets Financings
The Overseas Private Investment Corporation has introduced a new insurance policy aimed at protecting bondholders in capital markets financings from losses due to political risk...
Greenhouse Gas Credits May Prove A Source Of Financing
Two recent sales of greenhouse gas credits suggest that such credits might serve as a source of financing in future for projects that use landfill gas, manure and other forms of solid waste...
US Courts Attack More Corporate Tax Shelters
The US courts upped the ante this fall in corporate tax shelter cases by signaling that they are prepared to hit companies that engage in such transactions with large penalties...
Third Parties Gain Right To Enforce Project Contracts
Third parties will have an easier time in the future asserting rights under project documents that are governed by English law as a result of a new law that took effect on November 11...
Failed plan for repatriating earnings | Norton Rose Fulbright
Most US companies take care to structure foreign investments so that US taxes can be deferred on the earnings for as long as the earnings are kept offshore...
US plans to reduce nitrogen oxide emissions | Norton Rose Fulbright
A federal appeals court declined on October 29 to reconsider an earlier decision to send the Environmental Protection Agency back to the drawing board on efforts to force states to start implement...
Recyclers exempted from environmental liabilities under federal Superfund law | Norton Rose Fulbright
Efforts to enact broader Superfund reforms failed. Congress is expected to consider broad-based reforms to the Superfund liability scheme next year...
Turkey
Turkey imposed an additional 5% corporate tax on 1998 earnings to help pay for earthquake damage in a measure that cleared parliament on November 26.
Poland
Poland cut the corporate income tax rate from 34% to 22% by 2004.
Ways and Means held a hearing on corporate tax shelters | Norton Rose Fulbright
Congress may take action next year, although the committee chairman, Rep. Bill Archer (R.-Texas), remains skeptical about the need for such action...
Saudi Arabia
Saudi Arabia is considering allowing foreigners to own up to 75% of joint ventures and offering tax holidays and soft loans to attract more foreign investment ...
China
China has extended a preferential 15% income tax rate to energy and transportation projects in the interior provinces.
Indemnity payments may not be taxable income | Norton Rose Fulbright
The IRS let a company deduct its environmental cleanup costs recently despite the fact that it was reimbursed for them under an indemnity agreement...
Foreign tax credits can be claimed in the US for “advance corporations taxes” | Norton Rose Fulbright
Until recently, the United Kingdom collected a “mainstream” corporate tax of 33% from UK companies and also required them, when paying dividends, to pay an advance corporations tax, or “ACT,” on t...
Consensus Bill on how US states would be allowed to tax telephone company income from cellular phones | Norton Rose Fulbright
Under the compromise, fees paid by cellular phone customers would be allocated to the state that is the “primary place of use.” The bill, introduced by Senators Byron Dorgan (D.-N...
Short tax years and depreciation | Norton Rose Fulbright
For example, a new partnership formed to own a power plant will have a “short” tax year when the power plant goes into operation...
US sanctions for Pakistan if formal finding that the government was overthrown in a military coup | Norton Rose Fulbright
US law bars any US financial assistance to a country “whose duly elected head of government is deposed by a military coup...
Tax disclosures in offering circular | Norton Rose Fulbright
Heliotrope General purchased preferred shares in a subsidiary that Ford Motor Company set up to hold its insurance and financial services assets...
The United States is appealing
The United States is appealing an October ruling by the World Trade Organization that “foreign sales corporations” are an illegal export subsidy.
Indonesia
Indonesia said foreigners selling shares in Indonesia rules ...
India
India continued its assault on foreigners who invest in India via treaty countries.
Massachusetts
MASSACHUSETTS said a cogeneration facility whose contract to supply power to the local utility was bought out by the utility had a higher value for property tax purposes than the cogenerator claimed.
Alabama
ALABAMA said that a local manufacturing company had to treat all of the dividends it received from two foreign subsidiaries as income from Alabama
sources.
Tax Depreciation
Tax depreciation for power plants should be shortened, the Edison Electric Institute urged the US Treasury.
MCI and Telecom USA
MCI AND Telecom*USA lost a frustrating case on appeal over investment tax credits.
Briefly noted
The airlines have been negotiating an industry-wide settlement with the US Treasury on the issue when costs of standard maintenance on aircraft engines must be “capitalized” and rec...
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