- 7 - In 1993, Payless agreed to an incorporated joint venture with Grupo Industrial Alfa, S.A. de C.V. (Alfa), a Mexican company. Alfa and Payless agreed to establish and operate stores selling home improvement products in Mexico. On October 18, 1993, Payless and Alfa executed a shareholders agreement that initiated the Mexican business venture. In the shareholders agreement, Payless and Alfa agreed to capitalize Payless de Mexico, S.A. de C.V. (Payless de Mexico) to distribute and sell building materials and home improvement products in Mexico. Payless held a 49-percent interest in Payless de Mexico. Payless de Mexico planned to build a chain of 25 stores in Mexico. In a supply agreement dated October 18, 1993, Payless agreed to supply Payless de Mexico with merchandise and products from its distribution centers. On December 12, 1994, Payless de Mexico opened its first store in Monterey, Mexico. In 1995, Payless sold its interest in Payless de Mexico to Versax, S.A. de C.V., a subsidiary of Alfa. OPINION Before 1986, taxpayers who acquired certain machinery and equipment for use in a trade or business were allowed an investment tax credit (ITC) against income tax liability in an amount equal to a percentage of the cost of the “qualified property”. Secs. 38, 46, 48. TRA section 211, 100 Stat. 2166, generally repealed the investment tax credit for property placedPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011