- 32 -
Burlington N. R.R. v. Oklahoma Tax Commn., 481 U.S. 454, 461
(1987); United States v. NEC Corp., supra at 1498.
Thus, the party who seeks to convince a court to adopt a
reading of a statute which is at odds with its plain meaning
labors under a heavy burden. United States v. NEC Corp., supra
at 1499.
Consistent with the foregoing, we examine the historical
development of section 936 and determine whether the regulation
implements the congressional mandate in a reasonable manner.
D. Analysis: Section 1.936-6(b)(1), Q&A-1 & -12, Income
Tax Regs.
Section 936 has its genesis in section 262 of the Revenue
Act of 1921, ch. 136, 42 Stat. 271, which exempted a U.S.
corporation from Federal taxes on foreign-source income if it
derived at least 80 percent of its income from sources within a
possession and satisfied certain other requirements. The
requirements for exemption from tax as a possessions corporation
were carried forward without material change into section 931 of
the Internal Revenue Code of 1954. In the Tax Reform Act of
1976, Congress eliminated the exemption and in its place enacted
the tax credit mechanism of section 436. Tax Reform Act of 1976,
Pub. L. 94-455, sec. 1051, 90 Stat. 1643.
Congressional intent for section 931 and its predecessors
consistently has been the encouragement of American business
investments in possessions of the United States. American
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