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Template:M summ 2002 ISDA Tax: Difference between revisions
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{{isdaprov|Tax}} and {{isdaprov|Stamp Tax}} are meant to be mutually exclusive and both refer to duties levied on payments under the swap {{isdaprov|Transaction}} itself and not under [[hedge]]s to it, so be careful when using them (especially in the context of [[delta-one]] [[synthetic equity | {{isdaprov|Tax}} and {{isdaprov|Stamp Tax}} are meant to be mutually exclusive and both refer to duties levied on payments under the swap {{isdaprov|Transaction}} itself and not under [[hedge]]s to it, so be careful when using them (especially in the context of [[delta-one]] [[synthetic equity swap]]s where the main [[stamp duty]] and [[capital gains tax|capital gain]]s issues accrue on {{eqderivprov|Hedge Position}}s. For those you might want to introduce a conceopt like {{eqderivprov|Local Tax}}es, or something similar. | ||
Here’s what the ISDA Users’ guide has to say about | Here’s what the ISDA Users’ guide has to say about {{isdaprov|Tax}} and {{isdaprov|Stamp Tax}}, in a footnote on page 58. | ||
:''“{{isdaprov|Tax}}” is defined in Section {{isdaprov|14}} as any tax, charge or other similar listed items, except a stamp, registration, documentation or similar tax (''i.e.'', a “{{isdaprov|Stamp Tax}}” as defined in Section {{isdaprov|14}} of the 2002 Agreement).'' | :''“{{isdaprov|Tax}}” is defined in Section {{isdaprov|14}} as any tax, charge or other similar listed items, except a stamp, registration, documentation or similar tax (''i.e.'', a “{{isdaprov|Stamp Tax}}” as defined in Section {{isdaprov|14}} of the 2002 Agreement).'' | ||
===Ok, so why leave out {{isdaprov|Stamp Tax}}?=== | ===Ok, so why leave out {{isdaprov|Stamp Tax}}?=== | ||
If you compare this definition with the equivalent definition of {{gmslaprov|Tax}} in the {{gmsla}} you might find yourself idly wondering about this strange little exception, missing from the GMSLA, for {{isdaprov|Stamp Tax}}. I know I did. Interestingly (or not, depending on your perspective) the drafters of the {{2002ma}} neglected to make use of the opportunity to use the definition of “{{isdaprov|Stamp Tax}}” in place of the less elegant “''stamp, registration, documentation or similar tax''”. But this might be the reason for the [[carve-out]]: {{isdaprov|Stamp Tax}} has its own little representation in Section {{isdaprov|4(e)}}. | If you compare this definition with the equivalent definition of {{gmslaprov|Tax}} in the {{gmsla}} you might find yourself idly wondering about this strange little exception, missing from the GMSLA, for {{isdaprov|Stamp Tax}}. I know I did. Interestingly (or not, depending on your perspective) the drafters of the {{2002ma}} neglected to make use of the opportunity to use the definition of “{{isdaprov|Stamp Tax}}” in place of the less elegant “''stamp, registration, documentation or similar tax''”. But this might be the reason for the [[carve-out]]: {{isdaprov|Stamp Tax}} has its own little representation in Section {{isdaprov|4(e)}}. | ||