Download Full text of 2004 FSC/ETI BillDownload A Profile of U.S. Exporting Companies, 2000 – 2001, by the U.S. Census Bureau’s Foreign Trade DivisionDownload Joint Committee on Taxation background data on Foreign Sales Corporations
In January 2002, the World Trade Organization (WTO) ruled that a U.S. taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. provision (called the Extraterritorial Income regime or ETI, which was a successor to the FSC or Foreign Sales CorporationAn S corporation is a business entity which elects to pass business income and losses through to its shareholders. The shareholders are then responsible for paying individual income taxes on this income. Unlike subchapter C corporations, an S corporation (S corp) is not subject to the corporate income tax (CIT). ) constituted an unfair trade subsidy to U.S. export companies. The WTO later ruled that failure by Washington to comply with this ruling could subject U.S. firms to as much as $4 billion in trade sanctions. Congress responded in October 2004 by passing the 2004 Corporate Tax and FSC/ETI Bill, also known as the American Jobs Creation Act of 2004. (Download the full text of the passed FSC/ETI bill below).
See also: A short overview of the FSC/ETI debate.
Share