If a U.S.firm creates a foreign subsidiary corporation,it:

Question

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By creating a foreign subsidiary corporation, the U.S. firm is subjecting it to the income taxation laws of the foreign country where it operates. This means that any income generated by the foreign subsidiary will be subject to taxation in that country. However, this does not fully avoid taxation in the United States on income repatriated from the foreign subsidiary. The U.S. firm may still be subject to U.S. taxation on the foreign earnings when they are brought back to the United States. Creating a foreign subsidiary may or may not significantly reduce taxable income depending on the circumstances.

If a U.S.firm Creates a Foreign Subsidiary Corporation,it