If for example, an MNC gets revenue from a client who is a citizen of a particular country, does that mean the MNC have to pay tax on that share of income to that particular country? Or can an MNC pick and choose which country they have operations in to pay taxes to?
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The country they are incorporated in. Often times they incorporate in countries with extremely low or non-existent tax rates like Ireland or the Cayman Islands. Even more often times that company doesn’t do anything but own all the intellectual property that it’s subsidiaries use, those subsidiaries “pay” licensing fees to their parent companies so they have much lower profits to report.
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