Word: mislabel
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Dates: during 1970-1979
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FOREIGN TAX CREDITS. These permit a company to deduct from the U.S. taxes due on its foreign income the income taxes that it pays to foreign governments. The aim is laudable: to prevent double taxation. But there is a catch. Many oil-producing countries mislabel part of the royalties that they charge on each barrel of oil as taxes, in order to create a U.S. tax credit for the oil companies. If the oil companies were forced to treat the disguised royalty as part of the cost of doing business-as other companies must-they would be able to deduct...