Sometimes you hear in the news about a U.S. Company buying a foreign company
and moving its headquarters overseas. Well, this can happen for many reasons.
One of them is a tax inversion
但是什么是税收倒置 为什么公司要税收倒置 为什么你需要注意它
But what are tax inversions, why are companies doing them and why should you care?
Here’s the reason why.
U.S. companies pay corporate tax rates of around 35 percent or more on their profits,
while their foreign competitors pay much less in their countries.
And if your company has locations or sells products in overseas, you get taxed on those
profits in the foreign country and again when you bring that money back to the United States.
This is called double taxation and your foreign competitors don’t have to pay it.
This hurts your company’s ability to compete, grow and reinvest in new products and jobs.
Hmmmm…now that doesn’t make sense.
So, back to the tax inversion.
If you’re a company based in the U.S. and want to make sure you stay competitive with
your foreign counterparts, and protect your company from foreign takeovers, what can you do?
The current U.S. tax system allows you to buy a foreign company
and use their headquarters as your own.
That way you don’t have to pay the higher U.S. tax rates on foreign profits
even though you still pay U.S. taxes on your profits in America.
This move allows you to keep a lot more of your profits and invest in new factories,
employees, and products.
Look at it this way: Let’s say you lived in one city but commuted to another.
If the rules were set-up so you were taxed by both cities on
your income—essentially double taxation—you would probably consider moving to the city
with the lower tax rates.
这并不意味着你贪婪 不忠 你只是适应当前存在的规则体制
It wouldn’t mean you were greedy, or disloyal—you would simply be working within the system
of rules that exists. Now…that makes sense.
So the next time you hear a politician complaining about American companies moving overseas,
remember it was politicians who passed the laws that encourage companies
to move away in the first place.
如果政客们能停止斗争 降低企业所得税税率 终止双重课税
If politicians would stop fighting with each other, lower corporate tax rates and end double taxation,
U.S. companies could compete better and wouldn’t need to invert to protect jobs
and their businesses.