International Business : Opportunities And Challenges In A Flattening World?

The advent of Internet has allowed companies to offer their goods and services throughout the world. Not only has the Internet opened up the floodgates of International marketing, it has also brought with it many other challenges such as cultural, political, and geo-economics challenges. In order to be successful in these global markets, companies must be very diligent in handling these challenges.

In this report I am going to define the meaning of Globalisation and assess the impact of globalisation on the way the business operate.

Today, firms have to deal with a global marketplace; marketers have no other choice. Participation in global marketing has begun to shift from a mere “option” to an imperative. The world is becoming more homogeneous. Distinctions between national markets

However, the companies only have to pay the U.S. tax for foreign revenues once they bring the profits back to the United States. As a result of these current tax laws, U.S. companies that seek to avoid high corporate tax rates hold their foreign earned profits overseas. “It just makes no sense to pay a substantial tax on it,” said Joseph Kennedy, a senior fellow at the Information Technology and Innovation Foundation (Rubin, R.). It is far too easy for an IT corporation to create a patent in a foreign country and direct revenue to a corporation within that country, thus avoiding the much higher U.S. tax rates. According to Joint Committee on Taxation estimates, the lost revenue is increasing over time as corporations find even more creative ways to make their U.S. profits look like offshore income (Richards, K., & Craig, J.). As result, multinational American corporations have as much as $2 trillion held in overseas subsidiaries and if brought into the United States with the current tax laws, the federal government could benefit by nearly $50 billion per year.

Selling a product internationally along with the 4 P’s (planning, producing, placing, and promoting) process of a company is called global marketing (Global Marketing, 2017). Being global is important because companies are able to reach customers from all over verses in one particular town. Offering different products and services for a variety of

➢ Taxation – firms functioning when dealing with a different country the subject to that country’s laws and regulations.

The income earned by the U.S. individuals and corporations in the foreign countries or foreign source are taxed by the U.S. government, even though other countries also tax any income earned within their borders. To offset this double taxation of income by two different countries, the U.S. grants both individuals and corporations a foreign tax credit (FTC) that can be used to offset income taxes assessed by a foreign country on the income earned there (Foreign Tax Credit, FTC, n.d.). The FTC is allowable for foreign income taxes and other similar taxes, such as excess profit and war profit taxes. However, only income taxes qualify for the credit. The Value Added Taxes (VAT) and property, sales and severance taxes do not qualify, although they may be deductible.

One option for Tech Sonic is simply to alter the reported price of transferring the desired goods from one subsidiary to the other. To take advantage of the lower effective tax rate, Tech Sonic could record a higher transfer cost between the Malaysian subsidiary and the United States subsidiary so that a higher proportion of the revenue from the transaction is reported under the Malaysian arm, thus transferring a greater portion of the financial tax burden to Malaysia, where the tax rate is lower. This strategy may carry less overhead costs in terms of operational changes since there would not need to be any changes in the location of production for the chips in question. Yet this would result in a loss in recorded income and profitability for the subsidiary that is purchasing the transfer as compared to the subsidiary that is recorded as having produced and delivered the transfer. So the management structure and, particularly, the extent to which the company hierarchy is integrated will determine how much any such change will give rise to a rift between managers of the two subsidiaries. Another problem is that such merely clerical changes may invite investigation from tax officials or other outside watchdog observers, looking for instances where companies are artificially trying to reduce their tax burden in a particularly high tax rate. Yet another problem with this strategic option is

T2 (Tea Too) is a tea heaven, a tea-lovers’ heaven. It is a premium brand established in 1996 in Australia over 18 years ago and cherished internationally by all tea devotees. It has 60 stores throughout in Australia, New Zealand, the United Kingdom, and America. However, the first retail outlet is located in Brunswick Street, Fitzroy. Maryanne Shearer is the creative director of T2 - Australia’s leading tea retailer, with largest range of tea and tea wares in Australia. It offers the country’s largest range of premium, fragrant tea and tea wares from all around the globe. Tea devotees can spend hours at their taster table, trying all the different types of hot and cold teas they have come up with. It’s

The U.S. Taxation of Foreign Corporations has set substantial guidelines for which dictate the regulations by which taxation is initiated. It is no secret that organization are constantly looking for new ways to ‘deduct’ their bottom line, reducing their tax liabilities. The U.S. has been diligent in ensuring that all considerations are covered, however from time to time issues arise that challenge the system in its current status. This papers will strive to answer the question can a foreign taxpayer argue substance over form? In many cases this is a taxpayers catch-22. The basis of the law allows for substance and form allows room for individual interpretation. There are

It is acceptable for U.S. companies to relocate their business to other countries for tax break purposes.

Intercompany transactions could occur across national borders, it would lead MNC companies to get more exposure to the differences of the tax regulations between countries. This might lead MNC companies to set up their objective to minimize their taxes through the use of discretionary transfer prices. These issues are attracted the attention of the member of the U.S. senate, foreign governments and international organization such as the OECD, G20 and European Union (EU).

Since Tout Suite will be a 100% owner of the foreign entity, it will be considered a “controlled foreign corporation” (CFC). As such, it will be subject to Subpart F rules, which would require Tout Suite to recognize some of its income each tax year as foreign base company income, regardless

International business contains all business transactions private and governmental, sales, investments, logistics, and transportation that happen between two or more regions, nations and countries beyond their political limits. Generally, private companies undertake such transactions for profit governments undertake them for profit and for political reasons. It refers to all those business activities which involve cross border transactions of goods, services, resources between two or more nations. Transaction of economic resources includes capital, skills, and people. for international production of physical goods and services such as finance, banking, insurance, and construction.

The international marketing is basically the solicitation of marketing main beliefs to supplementary than one nation state. On the other hand, present is a cross over in the middle of what is frequently communicated by way of worldwide publicising and international marketing which is a comparable word. On behalf of the Marks & Spencer determinations of this object lesson on international marketing and persons that monitor it products for international marketing and comprehensive selling are substitutable. The consequence is a international methodology for spreading the business in international marketing. Somewhat than concentrating on country marketplaces, that is the changes owing to the bodily site of consumer’s collections,