Netscape Communications Corp would face a major capital gains tax bill if it were to spin off its Netcenter portal site as a separate company, it seems. According to the Wall Street Journal, Netscape could not spin it off tax-free without five years of gross receipts. In other words, it would have to have been operating the Netcenter site for five years as an ongoing business in order to avoid tax on any shares sold to the public. And that tax bill could be substantial. The first time Netscape mentioned Netcenter publicly as a brand name was just over a year ago (09/05/97), but obviously Netscape has always had a web site, which it could argue always included a subset of what Netcenter offers today. If it failed to prove that it had been running Netcenter – or something very like it for five years – Netscape, as far as we can gather, would be liable for a gains tax on the difference between the profits from the sale and the amount of money it had invested in the site. However, CS First Boston’s Netscape watcher Lise Buyer reckons tax issues are just one of many concerns Netscape has about spinning off Netcenter, the others including timing and the state of the market. Would it be better for shareholder value to sell it off soon, or hold on to it hoping that it becomes one of the top two portals? Netscape didn’t get back to us