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From 2000 to 2010, the U.S. experienced a net loss of 687,000 jobs due to outsourcing, primarily in the computers and electronics sector. Public disenchantment with outsourcing has not only stirred political responses, as seen in the 2012 U.S. presidential campaigns, but it has also made companies more reluctant to outsource or offshore jobs. [102]
Offshoring to foreign subsidiaries has been a controversial issue spurring heated debates among economists. Jobs go to the destination country and lower cost of goods and services to the origin country. On the other hand, job losses and wage erosion in developed countries have sparked opposition.
Countries with a residence-based system of taxation usually allow deductions or credits for the tax that residents already pay to other countries on their foreign income. Many countries also sign tax treaties with each other to eliminate or reduce double taxation. In the case of corporate income tax, some countries allow an exclusion or ...
If there's one position that both presidential candidates can agree on, and it may be the only one, it's that outsourcing jobs overseas, or "offshoring," is absolutely terrible for American workers.
By now it's routine for us to hear about jobs going overseas, or certain aspects of manufacturing or customer service being outsourced to countries like China and India. But now outsourcing ...
The Tax Cuts and Jobs Act of 2017 (TCJA) imposed a one time tax on these offshore profits at 8% (non-cash) and 15.5% (cash) respectively. The Act also includes a provision that taxes all foreign profits in the US in the year they are earned ending the ability of US companies to defer paying US tax on unrepatriated earnings.
America's top tax rate of 37% might seem high, but when it comes to tax revenue as a percentage of a country's GDP, there are plenty of other countries with a higher tax burden than the United States.
The customer and the supplier countries like US, UK, Canada, Japan, Australia, and West European nations are considered as high-cost countries (HCC) whereas resource rich and regulated wage labor locations like China, India, Indonesia, Bolivia, Brazil, Russia, Mexico, and East European nations are considered low-cost countries (LCC).