If an MNC's home country allows it to deduct from its taxable income the income tax paid by its foreign subsidiary:
A) the MNC receives full credit for the foreign income tax paid by the subsidiary,and the effects of double taxation are eliminated.
B) whether the MNC receives any relief from double taxation depends on the relative tax rates between the MNC's home country and the foreign country where the subsidiary operates.
C) the MNC pays domestic income taxes on its income and on its subsidiary's after-tax income,and the effects of double taxation are reduced.
D) the foreign subsidiary is relieved of an income tax burden,and the MNC will receive a large remittance of profits from its subsidiary.
Correct Answer:
Verified
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