Tax On Funk Food

In an effort to alter bad eating habits of its citizens, the Hungarian government plans to bring in “tax on hamburgers.”

“Ministry of studying the likely effects of introducing taxes called” hamburger tax ‘, “said economics minister Gjergi Matolči on the site of the Assembly.

“Psychoanalysis of dietary habits in recent years and their effects on health shows that eating too much fatty and salty food reasons more problems,” noted the minister.

“To stop this process, various ministries are studying taxes that could be introduce, their economic effects, but it is still unclear which products will be to relate, and how to used the profits from these taxes,” he added.

If being a “hamburger tax”, a fast food restaurant chains will be able to protest to him as a discriminatory measure, since the Hungarian cuisine is not easy.

IRS Announces VCAP Relief from Debt Extinguishment for Certain Issuers of Tax-Exempt Bonds

Internal Revenue Service (“IRS”) Announcement 2011-19 provides relief from debt extinguishment for certain issuers purchasing and holding their own tax-exempt securities under the Tax Exempt Bonds Voluntary Closing Agreement Program (“TEB VCAP”).

Notice 2008-41, modified by Notice 2008-88, and extended by Notice 2010-7 to December 31, 2010, provided temporary rules allowing state and local governmental issuers to purchase and hold their own tax-exempt obligations for temporary holding periods. This rule prevented extinguishment of the purchased obligations under § 103 and §§ 141-150 of the Internal Revenue Code (“Code”). These temporary rules provided relief from liquidity constraints in the tax-exempt bond market during the financial crisis.

For various reasons, some issuers that purchased their bonds under the temporary rules were unable to resell their bonds by December 31, 2010. Other issuers are experiencing an ongoing need to purchase and hold their own tax-exempt obligations due to certain financial challenges.

Closing agreements executed under this program provide that the extinguished bonds are treated as remaining outstanding for purposes of § 103 and §§ 141-150 beginning from the later of January 1, 2011, the expiration of the temporary rules, or the date the issuer purchases its obligations.

The closing agreement will require the issuer to:

(1) submit a resolution of its intent to resell or currently refund the extinguished tax-exempt bonds no later than 180 days after the closing agreement is signed;

(2) submit representations or an unqualified bond counsel’s opinion the bonds are outstanding legal, valid and binding obligations of the issuer under State law and, if treated as outstanding under the closing agreement, will qualify as tax-exempt obligations of the issuer under § 103 of the Code;

(3) pay a fee based on the formula described in the Announcement. The TEB VCAP requests are due no later than December 31, 2012 under the operating procedures described in section 7.2.3 of the Internal Revenue Manual.