Consider a U. S. corporation with a single foreign branch in Greece. Suppose the firm’s foreign taxes paid are less than the foreign tax credit limitation and the firm expects to remain in this position indefinitely. Would the firm be for or against a Greek tax increase that would go to fund special employee training programs from which it would benefit?
Answer to relevant QuestionsUnder what circumstances will a U.S. corporation have an incentive to shift U. S-source income to be foreign- source income? What is the import of Section 482 for firms forming subsidiaries in foreign tax jurisdictions? Do tax-payers have much freedom in setting prices of goods and services that they transfer to and from their own subsidiaries? AD Corporation is a large U. S. manufacturer of frozen bananas. In year 1, AD has $ 100 million of Canadian- source income, taxed at a 40% Canadian rate. AD’s U.S. source income is negative $ 30 million due to a casualty ...According to Miller’s (1977) paper, leverage does not increase firm value, even though interest expense on debt is tax deductible by corporations. Why? What is the difference between a firm’s financial accounting asset basis and its tax asset basis? How would you quantify such a difference? Be sure to mention specific accounts in the financial statements and techniques.
Post your question