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  • Jefferson Smurfit Corporation of St. Louis, US is to merge with Stone Container of Chicago. The merger is worth approximately $2 billion and will create one of the world's largest paperboard and paper packaging companies. It will be known as Smurfit-Stone Container Corporation and will be worth approximately $11 billion.
  • Van Kampen American Capital Senior Income Trust, has made a $1.6 billion initial public offering, the second-largest closed-end offering in history.
  • Since the early 1990s, non-resident corporate income taxpayers in Spain have benefitted from important domestic law exemptions pertaining to different types of income from Spanish sources.
  • US paint maker PPG Industries has agreed to purchase two coatings businesses from UK chemicals company Courtaulds. The deal is worth approximately £200 million ($320 million). PPG had been bidding against Dutch group Akzo Nobel for control of the whole of Courtaulds. Akzo Nobel is now expected to take control of the remaining areas of Courtauld's businesses (see International Tax Review June 1998, page 6).
  • Canadian drinks and entertainment group Seagram has agreed to acquire Polygram, the Dutch music and film company for $10.6 billion. Seagram will buy 75% of PolyGram from Philips, the Dutch electronics company, and the remaining 25% that is in public issue. The acquisition will be partly financed by the sale of Tropicana, Seagram's fruit juice subsidiary.
  • During the last few months there have been a number of changes to the Russian tax law, arising from changes to the legislation and from judicial decisions. The major changes are outlined below.
  • Several new international reporting initiatives have been enacted following Canada's 1995 federal budget. These include expanded reporting rules for foreign affiliates, and new reporting requirements in respect of contributions to or distributions from non-resident trusts.
  • In a surprise move, the UK government announced a withdrawal of the Foreign Earnings Deduction in its March budget. This presents a major headache for many UK residents working overseas, and will significantly increase the costs of all those companies which have employees working abroad. Action needs to be taken now.
  • The UK Inland Revenue has called for an international task force to combat tax evasion. Nick Montagu, chairman of the Inland Revenue, believes that the G8 countries should create a combined detective force. Montagu cites electronic commerce as a new threat, which requires concerted global action if tax revenues are to be defended.
  • The European Commission has ruled out the establishment of a new tax on electronic commerce. Instead, the Commission wants to adapt existing taxes, particularly value-added tax (VAT), to transactions that take place via electronic systems such as the Internet. In a new set of guidelines on the taxation of electronic commerce, the Commission outlines four key principles: