Marty Company, located in Illinois, learns that the state of Illinois will be increasing taxes on all businesses. Before the tax goes into effect, Marty Company relocates to Missouri where the taxes are far lower on businesses. This type of business strategy is called:
A) Non-compliance
B) Avoidance
C) Prevention
D) Value creation

Question

Quizplus · Accepted Answer

Avoidance is the strategy of legally arranging one's affairs to minimize tax liabilities. In this case, Marty Company is moving to a jurisdiction with lower taxes, which is a common tax avoidance strategy.

Marty Company, Located in Illinois, Learns That the State of Illinois