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

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When a U.S. firm creates a foreign subsidiary corporation, it fully subjects it to income taxation in the foreign country. This means that the subsidiary will be required to pay taxes on all income it earns in the foreign country, just like any other local business. However, the U.S. parent company may still be subject to U.S. taxation on income earned by the foreign subsidiary, depending on the specific tax laws and treaties between the two countries.

If a US Firm Creates a Foreign Subsidiary Corporation, It