Explanation of Issues in PPL Corporation v. Commissioner of Internal Revenue

Abstract:     
This short article briefly summarizes the chief arguments of PPL corporation and the IRS as to whether the United Kingdom's Windfall Tax qualifies for a United States foreign income tax credit under 26 U.S.C. § 901. PPL argues that the Windfall Tax is a tax on income and that PPL is therefore entitled to a foreign tax credit that will greatly reduce its federal income tax liability. The IRS argues that the Windfall Tax is a tax on value and, accordingly, that PPL is not entitled to a foreign tax credit. This case could have major implications for U.S. corporations, which claim over $100 billion in foreign tax credits each year.

Number of Pages in PDF File: 4

Keywords: tax, international tax, corporate tax, foreign tax credits, PPL, Entergy, income tax, value tax, Section 901, Section 902, deferral, territoriality, worldwide taxation, double taxation, windfall tax, privatization, privatisation, utilities, utilities regulation, energy taxation, valuation

JEL Classification: H20, H25, H29, K34

Accepted Paper Series