Sweden has a classical system of taxation. Calculate the total taxes that would be paid by a company headquartered in Stockholm that earns 1,500,000 Swedish krona (SEK) and distributes 50 percent of its earnings as a dividend to its shareholders. Assume that the company’s shareholders are in the 40 percent
|
Country A |
Country B |
Country C |
Country D |
|
|
Royalty from Country A operations |
$20 |
|||
|
Pretax income |
$90 |
$90 |
$54 |
|
|
Income taxes (20%/40%) |
18 |
36 |
-0- |
|
|
Net income |
$72 |
$54 |
$54 |
Required: Calculate the foreign and U.S. taxes paid on each foreign-source income.