Page 100 - International Taxation IRS Training Guides

Taxpayer
Motivation for Low ETR

 Sustained, predictable improvements in earnings
per

share (“EPS”):

market capitalization
• Increase share price and total

boost executive compensation
• Possibly

 Reduce Tax Expense

• US
GAAP Tax expense directly reduces net income, which
lowers EPS
unfavorably
• Taxpayer
pressure to manage ETR in comparison to peers

 Control Costs

try to manage costs efficiently (including taxes)
• Companies
value
to produce shareholder

• Tax
costs can be managed efficiently through legitimate
planning

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