Volume 2 — Governance and ControlsGovernance and Controls © Copyright 2002, All rights reserved 15 4.5 Tax Tax support of a trading and marketing operation requires knowledge of the tax laws of federal, state, and (if applicable) foreign governments. This knowledge extends beyond income tax to sales, franchise, excise, and other taxes. Tax support is necessary when seeking to enter new markets and to trade and market new products, including new types of financial instruments. Tax support should determine the effect of changes in tax laws. This group also determines the tax effect of transactions (including determining the most efficient tax structure for transactions). Tax support should also develop hedge identification procedures that meet tax laws and regulations.