- 33 -
DARFs, the official tax receipts, report only the aggregate
amount of tax paid for all lenders, it is the schedules
accompanying the DARFs upon which petitioner relies to establish
its portion of the withheld taxes, i.e., the amount of
withholding tax the Central Bank paid on interest remitted to
petitioner, $166,415 for 1984 and $181,272 for 1985, for which it
is seeking the foreign tax credit. The schedules established,
and consequently we find, that the Central Bank received
pecuniary benefits of $66,566 for 1984 and $72,509 for 1985.
Petitioner alternatively maintains that Amoco Corp. v.
Commissioner, 138 F.3d 1139 (7th Cir. 1998), affg. T.C. Memo.
1996-159, controls and is dispositive of the issue to be herein
resolved. Petitioner contends that the Central Bank is to be
considered part of the Brazilian Government. Petitioner asserts
that the transaction between petitioner and the Central Bank
complies with section 1.901-2(f)(2)(ii), Example (3), Income Tax
Regs., and is specifically exempted from the subsidy rules of
section 1.901-2(e)(3), Income Tax Regs. Accordingly, petitioner
posits that its 1984 and 1985 foreign tax credits for the
10(...continued)
the receipt of an erroneous pecuniary benefit after June 28,
1985. Since the parties have reached an agreement as to
petitioner’s foreign tax credit for amounts withheld after June
28, 1985, we need not decide whether the Central Bank made a
clerical error or received an erroneous pecuniary benefit for
that period. We have no reason to question the accuracy of the
schedules with respect to the amount of the pecuniary benefit
received by the Central Bank on or before June 28, 1984.
Page: Previous 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 NextLast modified: May 25, 2011