Writing Assignment: Offshore Accounts and Tax Benefits
Prior to the passing of the Tax Cuts and Jobs Act (2017) some of America’s largest corporations were able to apply questionable, yet legal, schemes to book profits in offshore accounts to avoid (not evade) higher levels of tax expense. These tax savings were substantial, it is estimated multinational corporations had been able to avoid an estimated $90 billion in federal income taxes each year.
Scenario: The Board of Directors, shareholders, and stakeholders are just now learning that the corporation employed offshore banking transactions to minimize tax burdens.
Checklist: As the Chief Financial Officer (CFO) address the following items:
Their are 3 terms Tax Planning, Tax Avoidance and Tax Evasion.
Tax Planning means using the benefits of Income Tax Laws to Minimize Tax burden with bonafide intention.
Tax Avoidance means avoiding the tax by following the laws but the main intention is to abuse of tax laws with malafide intention.
Tax Evasion means to evade the tax using illegal means.
Both Tax avoidance and Tax Evasion are illegal.
Keeping in view of the above perspects,Company is following Tax Avoidance which is illegal.
So its not following ethical practice and being a CFO I will stop such practice.
Writing Assignment: Offshore Accounts and Tax Benefits Prior to the passing of the Tax Cuts and...