How can multinationals protect themselves from double taxation?

Multinationals can protect themselves from double taxation by taking advantage of international tax law. In Washington, international tax law allows multinationals to take advantage of double tax treaties, which can eliminate the risk of double taxation. Double tax treaties are based on agreements between two countries and specify which income tax rate should be applied to different types of income that cross borders. These treaties are designed to ensure no tax is paid twice on the same income. Multinationals can also take measures to minimize their exposure to double taxation. They can do this by structuring their operations in a way to minimize their tax liabilities. For example, companies may arrange for their operations to be split across different countries, which can reduce the amount of income being taxed in one country. They can also make sure to take advantage of tax deductions and credits that are available in different countries. Finally, multinationals can also negotiate with foreign tax authorities to get a special deal to prevent double taxation. Often, if a multinational can demonstrate its operations will create employment and economic opportunities in a country, the foreign tax authorities may be willing to waive certain taxes for a specific amount of time. In conclusion, multinationals can protect themselves from double taxation by taking advantage of international tax law, by taking measures to minimize their exposure to taxation, and by negotiating with foreign tax authorities.

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How can multinationals protect themselves from double taxation?

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