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A company that is legally incorporated abroad — say, in Ireland or the Cayman Islands — has to pay tax in the United States only on income derived from United States sources.
More than 1,200 companies that are incorporated abroad have listed securities in the U.S., and none of them have to disclose much more than they do at home.
However, its main achievement is to reveal how little is understood about the incentive structure of Chinese business.The authors examine "red chips"—companies operating in China but incorporated abroad and listed in Hong Kong.
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Other decisions to incorporate abroad appear to be driven by historical links with foreign jurisdictions.
It is only a matter of time, however, before the global legal marketplace makes it easier, faster and cheaper for start-ups to incorporate abroad.
Advocates of a territorial-based tax system often point out that taxing United States companies on their worldwide income creates an incentive for new companies to incorporate abroad instead.
Congress can try to close this loophole, but companies that want to lower their taxes will still find a way to incorporate abroad, something made easier by the ability to raise capital through an I.P.O.
Or domestic entrepreneurs who choose to incorporate abroad?Nor are foundations the paragons that Sir Colin imagines: they are frequently created to reduce corporate tax burdens and invariably hand power to a select group of insiders.
Democrats, sensing a new political opportunity in the run-up to November's Congressional elections, stepped up their efforts to highlight themes of corporate abuse -- everything from the Enron collapse to the prices charged by drug companies to corporate attempts to avoid taxes by incorporating abroad.
It will also impel more companies to incorporate abroad.
The irony, for him, lay in his obvious devotion to Italy and its food — and to the demonstrable fact that, whatever "chemistry" he had introduced, and whatever tastes he had incorporated from abroad, Italy was vivid in every dish he served at Francescana.
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