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Not really. If the studio is HQed in California, and they paid a studio in Taiwan, they must declare that money. it is trivial to trace that and tax service acc
by gcb0 13y ago
Not really. If the studio is HQed in California, and they paid a studio in Taiwan, they must declare that money. it is trivial to trace that and tax service accordingly.
What they do, is to "hire" those people as contractors just for that job, pay the upfront price of setting up a fake shop, and avoid all those service taxes.
Similar to you paying someone overseas for a work, versus your company having a research dept in india while HQ in Palo Alto. The upfront costs for the later are higher, but the return if you want to have the indian team larger than the US team will be better in the long run.
- mprovost 13y agoOf course Hollywood has accountants that have figured all of this out, they're notorious for it. It's even easier when you do business everywhere, so you can just keep profits from showing movies in the UK in your bank account in London, and the next time you want to make a movie there just pay them out of that account, and export the finished movie back to LA, and the US govt will never see any of that money. The example about India is a good one, as we know lots of development work is outsourced. The point that this article is making is that the MPAA has argued in court that intellectual property should be imported like any other property. Of course they're doing this to stop "piracy", but the unintended side effect could be that their own IP (the original films) becomes subject to free trade agreements. If that's true, then it could also affect the software industry which is doing essentially the same thing (possibly without subsidies, just taking advantage of different costs of living and wages).