Resuming its discussion of the proposed revision of IAS 12 Income Taxes the Board tentatively decided that:
- tax credits should be defined as a benefit granted by the tax authorities that takes the form of an amount that reduces tax payable.
- investment tax credits should be defined as tax credits that are directly related to the acquisition of depreciable assets.
- it would reverse its previous tentative decision on special deductions and that IAS 12 should remain silent on the issue.
- it would reverse its previous tentative decision that the tax rate used to measure deferred tax assets and liabilities should be the probability weighted average of the possible rates that might apply and revert to the existing wording of the rate �expected� to apply.
The Board also discussed whether the effect of future distributions should be included in the measurement of tax assets and liabilities. The Board tentatively decided that:
- in jurisdictions that have a different tax rate depending on whether taxable earnings are distributed to owners, an entity should use the rate(s) that it expects will apply to the item being measured, incorporating the entity�s past practices and future expectations of distributions.