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The key to understanding this is to knowing that only foreign profits (earned from non-American customers in non-American jurisdictions) are subject to the lowe
by rprasad 16y ago
The key to understanding this is to knowing that only foreign profits (earned from non-American customers in non-American jurisdictions) are subject to the lower taxes through this scheme. This is income that, strictly speaking, the US government does not truly have a right to tax since it has only the most tenous nexus to an American taxpayer.
The money Google makes in America is still subject to the normal American tax rates applicable to corporations.
- beagle3 16y agoIf you buy Microsoft software outside the US, you'll be talking to Microsoft Ireland, even if you are in the UK and the software you bought was fully developed in the UK (or in the US). Either way, the only reason to do that for Microsoft is because of Ireland's tax. And, if you follow the stock market, you'll see that many companies raise money by selling bonds backed up by money which will pay 30% to be repatriated (if they need to give it back), without taking those 30% into account. Many of them are betting on a "repatriation holiday". And they're probably going to get one because they own the legislation.