Question

Consider a situation where “David” works for a US based firm in another Country “XYZ”. The government in Country XYZ assesses taxes at an exorbitant rate as the firms are expected to report only 70% of their actual earnings. If a firm reported its actual earnings, the taxes would force it out of business. David’s firm is considering whether it should adopt the local practice of dishonestly reporting its profits to Country XYZ, even though it would be illegal to do this in the United States. Whatever the decision, the firm will continue to report its profits honestly to the US government.

Describe ethical issues raised in this case? Be sure to address cross-cultural nature of the issues. (Write 1 paragraph)

Using the ethical approaches found in the text for cross-cultural ethics, do you think there are any creative middle way solutions? If so, discuss one of them. Identify the positive and negative consequences that would result from this solution. (Write 1 paragraph)

Answer 1

answer-

As we all know that ethics means being right, fair and honest in situations we put into. so In this case, David is faced with ethical issue that is dishonest and unfairness.I am saying this from cross cultural point because In US culture reporting actual earnings to government with honesty is called fair and right act which david's firm is doing in US but in This XYZ country this is dishonesty reproting is considered legal which i think is unethical even it is legal in this country.The act of David to report dishonesty may move him towards corruption and bribery because this rule is not applicable in other countries.

The one middle way which i could think of is to let government of XYZ country focus on how honest reporting will help to improve the situation of their country as well help its people. If government of xyz country is ready to hear and accept honest reporting then i think Company would be able to report with honesty.

The positive consequence of this situation would be that David and its firm will be ethical, legal and work with honesty. also XYZ country will get benefit in terms of honest reporting and good taxe earnings for growth of its country.

the negative consequence is that government may not agree and make david's firm to follow their dishonest reporting.