International Taxation
In the countries where they operate, companies pay direct taxes, indirect taxes, sales taxes, value-added taxes, and carbon taxes, among others. Direct taxes are typically imposed on income from profits, capital gains, royalties, interest, and dividends. Indirect taxes apply to firms that license or franchise products and services or that charge interest. In effect, the local government withholds some percentage of royalty payments or interest charges as tax.
A sales tax is a flat percentage tax on the value of goods or services sold. It is paid by the ultimate user of the good or service. A value-added tax (VAT) is payable at each stage of processing in the value chain of a product or service. VAT is calculated as a percentage ...
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