Companies that produce physical goods in specific geographic locations and sell them in other specific geographic locations cannot play tax games the way tech companies (which sell intangible goods and services created from intangible inputs) can.
"Companies that produce physical goods in specific geographic locations and sell them in other specific geographic locations cannot play tax games the way tech companies "
Apple can produce an iPhone in China, sell it to Apple HK and Apple HK exports it to Apple US. The main profits can be made this way in HK tax free. (Not sure about apples actual setup. Just an example).
The same way imported iphones lead to an increased trade deficit between China and the US. The profits are made by US companies, the tiny profit for assembly is made in China. This phenomenon is known as "dark matter" in accounting.
Apple can produce an iPhone in China, sell it to Apple HK and Apple HK exports it to Apple US. The main profits can be made this way in HK tax free. (Not sure about apples actual setup. Just an example).
The same way imported iphones lead to an increased trade deficit between China and the US. The profits are made by US companies, the tiny profit for assembly is made in China. This phenomenon is known as "dark matter" in accounting.