On 8 August 2008, Departmental Instruction No. Paw. 135/2551 (2008) was issued to clarify the deductibility of investment losses where a parent company, which is also the creditor of its subsidiary, subscribed for new shares issued by its loss-making subsidiary in the course of a business turnaround.

Paw. 135/2551 (2008) explains that the amount of subscription for new shares which i…

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