US law encourages businesses and individuals to take whatever steps legally acceptable to postpone or reduce tax payments. However, it is obvious that the companies leaving profits overseas are doing this to pressure the government to alter current legislation so as to reduce their tax obligations. This is not right. They should comply with the current law in place affecting profits they've already generated and push to change the law in case of future tax obligations.
I agree the US government or indeed any other government need to come up with a solution to attract businesses transfer its offshore profits back into the businesses country of domain.. There's no doubt these businesses should pay up period. I think perhaps some sort of lower taxes ought to be introduced by the government to induce the movement of such offshore profits.
that's so true! but it's just not companies it's individuals too. I had US citizen co-workers living/working in MX & China and they paid nothing or very little in taxes. Rules may have changed but it was ok to exclude from your gross income up to 100K plus housing expenses, and fair market value of pay received as goods/services. I'm guessing this is why many retirees flock to Mexico too.
The US Government should realize the amount of money they are losing. Maybe they can open a 2 year window with lower taxes, and capture those profits. WHat options do they have?
@Ariella, i do agree that we have to pay tax if we make profit on foreign inverstment but i am thinking that it is not logical to pay tax twice. I am not favoring companies because i know that finance people make fool of the government by route the money through the tax heavens.
@Himanshugupta But individuals do have to do that. If I were to invest in something that generates income abroad, I still have to pay income taxes on that where I live. Even on a local level, people who live in one state and work in another have to both pay taxes where they work and where they live, though they do get credit in their home state for what is paid to the other state.
Why do any government want to tax the income that someone has generated outside and especially when that income has already been taxed? I compare it to the situation when a person who is working in one country try to send money home at get taxed twice (once income tax and second remittance tax).
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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