[comp.dcom.telecom] Foreign Companies in the US

raj@homxb.att.com (Rajeev B Patil) (02/22/90)

Having followed the AT&T vs. Japanese companies debate, I found the
following article very interesting.

The New York Times Feb 18, 1990  Page 1
"IRS Investigating Foreign Companies For Tax Cheating"

Excerpts from the article:

"...Federal tax officials are investigating many American subsidiaries
of Japanese companies on the suspicion that they have underpaid
corporate income taxes by billions of dollars."

" As foreign-owned assets in the United States more than tripled in a
decade to $1.8 trillion, the gross income ... more than doubled.  But
the total taxes they paid hardly changed ..." 

" Tax officials assert that some subsidiaries understate income, thus
minimizing tax liability, by manipulating transactions with parent
company."

No wonder the Japanese products are cheaper !!!!


Rajeev

john@bovine.ati.com (John Higdon) (02/24/90)

Rajeev B Patil <raj@homxb.att.com> writes:

> " Tax officials assert that some subsidiaries understate income, thus
                  ^^^^^^
> minimizing tax liability, by manipulating transactions with parent
> company."
 
> No wonder the Japanese products are cheaper !!!!

Until all this is proven somewhere, I wouldn't "ah-HA" too much.
Remember, the popular Japan-bashing is as much rampant in the
government as it is in companies like AT&T. Just as AT&T defenders
have gone off foaming at the mouth without doing any actual
investigating of reality, so too have our trusty government officials.

Besides, even if true, it doesn't explain why Japanese products are
*better*. I think that has been explained adequately in other posts.


        John Higdon         |   P. O. Box 7648   |   +1 408 723 1395
    john@bovine.ati.com     | San Jose, CA 95150 |       M o o !