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An important (albeit often unnoticed) feature of Spanish tax law is the responsibility regime of representatives of permanent establishments and of foreign partnerships and similar entities with a presence in Spain. Since January 1 2003 these representatives are jointly and severally liable for the tax debts of their principals.

The Canada Revenue Agency (CRA) has issued a series of favourable tax rulings in which it concluded that Canadian domestic anti-avoidance legislation would not apply to certain proposed transactions involving back-to-back cross-border loans. In particular, these rulings consider situations in which Canadian trusts and partnerships use such structures to obtain foreign financing, and in so doing, avail themselves of a withholding tax exemption that is ordinarily only available to Canadian corporations. The favourable outcome of these rulings is good news for both non-resident investors and Canadian non-corporate entities alike.

On September 30 2004 the Brazilian authorities issued Provisional Measure 219 (PM 219), which granted tax benefits on purchases of fixed assets. Effective as from October 1 2004, Brazilian legal entities are allowed to claim a credit for social contribution on net income (CSLL) purposes (to be offset against the CSLL liability), corresponding to 25% calculated over the book depreciation of assets acquired between October 1 2004 and December 31 2005.

The domestic production deduction is a significant element of the new US corporate tax legislation. It has transfer pricing implications which are not yet completely clear, explain Sean Foley, Anne Welsh and Thomas Herr of KPMG LLP (US)

Representatives of the US and French governments signed protocols on December 8 2004 amending the 1994 France-US income tax treaty. The treaty protocol addresses the complicated treatment of cross-border partnerships by including flexible form-of-entity rules that will reduce the risk of double taxation for US investors in France.

Liechtenstein, Monaco and San Marino signed savings tax agreements with the EU in Brussels on December 7 2004 . The three countries are the last of the five non-EU states whose participation is required, according to the terms of the EU Savings Tax Directive.

Hermann Eber-Huber, a former tax partner at Linklaters, has left the multinational law firm to join the Frankfurt-based finance boutique Smeets Haas Wolff. Eber-Huber specializes in tax consultancy, M&A and the taxation of real estate.

The US tax system benefits from a healthy interchange of tax professionals between the Treasury and the IRS on the one hand and law and accounting firms on the other. Many tax specialists, such as Deborah Harrington, remain in government for three or four years before returning to private practice. Harrington returned to Deloitte on November 19 2004.

Laszlo Kovacs: Advocates a common consolidated tax base for the EU The new EU commissioner for taxation and customs union is sticking to European Commission orthodoxy on corporate tax.