The US Treasury Department and Internal Revenue Service (IRS) have issued proposed regulation to curb abuses caused by transactions that artificially generate foreign tax credits. The regulations were announced in Release IR-2007-73 dated 29 March 2007. The announcement states that the regulations will disallow foreign tax credits for foreign taxes purportedly paid in connection with certain artificially engineered, highly structured transactions. The announcement further states that the transactions addressed by the regulations are structured so that a US taxpayer voluntarily subjects itself to foreign tax where an ordinary business transaction generally would result in little or no foreign tax paid...