Supreme Court Denies Review in Historic Boardwalk and Entergy

The Court this week denied the government’s petition for certiorari in the Entergy case.  As explained in our prior post on the PPL decision, this ruling was inevitable in the wake of the Court’s decision for the taxpayer in PPL.  The denial of certiorari now cements Entergy’s victory in the Fifth Circuit.

The Court also denied certiorari in Historic Boardwalk, the historic rehabilitation tax credit case decided in the government’s favor by the Third Circuit.  See our previous reports here.… Read More

Supreme Court Rules for Taxpayer in PPL

[Note: Miller & Chevalier filed a brief in this case in support of PPL on behalf of American Electric Power Co.]

The Supreme Court this morning unanimously ruled in favor of PPL in its case involving the creditability of the U.K. Windfall tax.  See our prior coverage here.  The opinion was authored by Justice Thomas, with Justice Sotomayor adding a separate concurring opinion.

The Court’s opinion is fairly succinct.  Viewing the government’s position as more formalistic, the Court stated that it would “apply the predominant character test [of the foreign tax credit regulations] using a commonsense approach that considers … Read More

Supreme Court Agrees to Hear Foreign Tax Credit Issue in PPL

October 29, 2012 by  
Filed under Entergy, International, PPL, Supreme Court

The Supreme Court this morning granted PPL’s petition for certiorari and will decide the question of the availability of the foreign tax credit for payments of the U.K. Windfall Tax on which we have reported extensively before.  See here and here. The Court took no action on the government’s petition for certiorari in the companion Entergy case from the Fifth Circuit.  That is a common practice for the Court when two cases present the same issue.  The Court will “hold” (that is, continue to take no action on it) the Entergy petition until it issues a decision in PPLRead More

Supreme Court Expected to Act on Windfall Tax Petitions in Late October

October 4, 2012 by  
Filed under Entergy, International, PPL, Supreme Court

In our previous post discussing the pending requests for Supreme Court review of the question of the creditability of the U.K. Windfall Tax, we noted that the Court had scheduled consideration of the PPL cert petition for its October 5 conference.  The Court has now postponed that consideration until its October 26 conference.  The reason for the change is to allow the Court to consider the PPL petition in tandem with the government’s petition in Entergy.

This postponement allows the Court to consider the issue with the benefit of an adversarial presentation.  As you will recall, the government “acquiesced” … Read More

Government Urges Supreme Court to Consider Foreign Tax Credit Issue

September 5, 2012 by  
Filed under Entergy, International, PPL, Supreme Court

As previously reported here a few weeks ago, PPL filed a petition for certiorari asking the Supreme Court to review the Third Circuit’s decision denying a foreign tax credit for U.K. Windfall Tax payments.  Given that the Fifth Circuit had decided the same issue in the opposite way in the Entergy case, there was a significant possibility that the government would not oppose certiorari, but instead would urge the Court to resolve the circuit conflict.

The government has now decided that its interests in resolving the conflict and potentially securing a reversal in Entergy outweigh its interest in preserving … Read More

Supreme Court Asked to Resolve Circuit Split on Foreign Tax Creditability of U.K. Windfall Tax

August 1, 2012 by  
Filed under Entergy, International, PPL, Supreme Court

[Note:  Miller & Chevalier filed an amicus brief on behalf of American Electric Power in the PPL case.]

We have fallen behind in updating the progress of the litigation concerning the creditability of the U.K. Windfall Tax that was imposed on British utilities in the 1990s.  As we previously reported, the Tax Court held in two companion cases that this tax was equivalent to an income tax in the U.S. sense of the term and hence creditable.  The government took two appeals — to the Third Circuit in PPL and to the Fifth Circuit in Entergy.  Those courts … Read More

Briefing Completed in Entergy

June 14, 2011 by  
Filed under Entergy, International

The government has filed its reply brief in the Fifth Circuit in Entergy.  (See our initial report on the case here.)  The reply brief puts forth a somewhat less disapproving attitude towards the examination of extrinsic evidence in foreign tax credit cases than previously advanced, stating as follows:  “The Commissioner does not contend (as he did below) that extrinsic evidence has no relevance in determining creditability under Treas. Reg. § 1.901-2(b).  Rather, our argument is that it was improper for the Tax Court to supplant an analysis of the windfall-tax statute with an analysis of extrinsic evidence.”

The … Read More

Taxpayer Brief Filed in Entergy

May 13, 2011 by  
Filed under Entergy, International

The taxpayer has filed its answering brief in Entergy defending the Tax Court’s decision that the U.K. windfall tax is a creditable tax for purposes of the foreign tax credit under Code section 901.  See our original report here.  According to the taxpayer, the essence of the government’s argument is that “the creditability of a foreign tax can be determined only by the literal text of the foreign tax statute, and that the consideration of any other evidence is legal error.”  This position, the taxpayer argues, is rebutted by “overwhelming authority establishing that the predominant character of a foreign … Read More

Government Opening Brief Filed in Entergy

April 14, 2011 by  
Filed under Entergy, International

The government has filed its opening brief in the Fifth Circuit in Entergy, seeking reversal of the Tax Court’s holding that the U.K. windfall tax is a “creditable” tax for purposes of the U.S. foreign tax credit.  See our previous report here.  The government argues that the Tax Court misapplied a three-part test set forth in the regulations for determining whether a foreign tax is creditable.  That test assesses whether the foreign tax has the “predominant character” of an income tax by examining whether it satisfies each of three requirements – relating to “realization,” “gross receipts,” and “net … Read More

Briefing Schedules Line Up on UK Tax Creditability Issue

March 3, 2011 by  
Filed under Entergy, International, PPL

The Third Circuit has now issued a briefing schedule in the PPL case that makes the government’s opening brief due on April 5.  This schedule should have the case marching along in fairly close parallel with Entergy, the companion case presenting the same UK tax creditability issue to the Fifth Circuit.  (See our previous post here.)  In Entergy, the government recently requested an extension to file its opening brief.  The court granted an extension, but for less time than requested.  The brief is now due April 13, after a 30-day extension.   That date will likely hold, since … Read More

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