Topic #5: Anti-avoidance Rules and Regulations (GAARS and SAARS) Tutorial Sheet 5 1. What are GAARS? 2. Discuss the common features of a GAAR? 3. What section of the ITA can Jamaica's GAAR be found? 4. Explain the benefits of GAARS? 5. Compare and Contrast: (1) Superannuation Fund Trustees Seramco Limited v Income Tax Commissioner and (ii) Commissioner TAAAD v Cigarette Company of Jamaica Ltd, provided on pgs. 124-125 of the reading Denbow (2013). 6. Coco What were the tax planning activities? What were the tax authority's positions, and what was the relevance of section 16 in the tax authority's stance? What were the court's decisions and why? Corporation P owns 85% of the outstanding stock of Corporation R. This year the employees of corporation R performed extensive management services for Corporation P. In return for the services, Corporation P paid $250m fee to Corporation R, which corporation P reported as a deductible business expense. Is the consulting arrangement an arm's length transaction? If TAJ challenges the validity of Corporation P's Deduction, what facts might the corporation offer as evidence of the validity of the arrangement? 7. What are CFC rules? 8. Mercyco is thinking of moving its corporate residence from Jamaica to St. Lucia. The company stated that the move is motivated by the desire to be strategically placed near its markets. However, MercyCo would also benefit from a number of tax factors, particularly a lower effective tax rate. What anti-avoidance rule exist in the ITA that can be used to restrict MercyCo from corporate inversion? 9. What are some of the features of pure tax havens? 10. Discuss what FATCA is and how it operates. 11. How does FATCA affect the average Jamaican