One is free to believe whatever they chose but that is a big 'IF.' While
the holding companies of Japanese corporations do pay state and local taxes,
if one searches the IRS site and you will discover Toyota etal do not pay
federal corporate income taxes on profit earn in the US.
Toyota no longer says their vehicles are made in the US since Honda, who
actually makes cars in the US, complained to the FTC about Toyota bogus
That may be your opinion but Toyota and all other Japanese corporations
operating in the US are indeed different, because of the tax rates and laws
in Japan. GM, Ford etal pay state and local taxes as well, just like
Toyota but they also pay federal corporate taxes on the profits made in the
US and Toyota does not.
European and American corporations pay taxes on the profits earned in the
US. Japanese corporations do not because of the tax credits they get for
taxes paid in Japan. They do not call it 'Japan Inc.' for nothing, because
Japanese corporations receive payments from the government as capital
returned, for profits from exports and profits earned in other countries.
In Europe foreign corporations like GM, Ford and Toyota etc pay corporate
taxes on the profits earned in Europe, period. That is one reason Japanese
cars are not as competitive in Europe, they do not have the tax advantages
that they have in the US. European taxes are high to cover their socialist
You might also do a search how much the individual states are contributing
to the costs of the new plants and infrastructure being built for Toyota
with state government backed low interest rate bold issues, in those states,
and who is paying the training costs for their under paid employees.
Pennsylvania did the same thing for VW, where I got a job as a field
engineer, back in the seventies because the plant would create thousands of
new jobs. A few years later when small car stopped selling, VW decided to
pull out and stuck the state with millions of dollars of forty year bonds.
that were to have be paid off by VW. Pennsylvania was lucky, they were able
to sell the plant to Chrysler and pay off most of the balance due on the
bonds, plus the penalties for retiring them early. Who will buy Toyotas
plants if indeed the domestics do go out of business or move offshore and
Toyota decides to build the cars in their new China plants where they too
can build them much cheaper? ;)
The Japanese company I worked for for 10 years was required to set up an
American operating company specifically so the USA could collect taxes on
the operations here.
Why would local government give any incentives to companies to build plants
and hire staff if there was no chance of collecting taxes down the road? My
community has entered into these kinds of agreements with large companies
because government sees the logical benefit of having the jobs in the
community. Eventually, when the agreements expire, they collect property
taxes from the company.
In any case, you are pointing your crooked little finger specifically at
Toyota, and that is wrong. Toyota is not doing anything that they are not
allowed to do. You may not like what they are doing, but tough shit.
I don't think Toyota was requried to set up American and Canadian operating
companies, but it set up several.
Because it gives their citizens jobs. And those jobs create other jobs, like
at the gas station, grocery store, Starbucks, as well as the job building
It would collect lots of taxes, not just the taxes directly from the
Local and state governments do this often, whether or not the company was an
I would be doing the same thing if I owned a big company: Go to the place
with the lowest costs, including state and local income taxes.
If a corporation wants to locate in a particular area they will do it
without subsidies from the local government. It is more likely they will
spend millions to fight the local government that tries to stop them.
I know of a recent incident where the local and county governments offered a
ten year tax free deferment, to the company building a facility for a major
well know US corporation. The School district vote no to the tax free offer
and refused to train the employees at taxpayer expense. Most local were
pissed at the school board. Guess what, they build the facility and the
corporation is paying the school district to train the employees and the
THREE governments are receiving millions in taxes from the facility that
would have been lost but for the smarter folks, like one of my sons, on the
school board. ;)
And so you do still, after 60+ years.
The British stopped calling the Germans "Huns" in 1919, and started trading
with the Germans at that time.
60+ years is an awfully long time to hold an ancient grudge. Most people,
even those who lost loved ones in WWII have gotten over the grudge factor.
As I said,
educated people no longer use the pejorative term, But I don't know
whether that describes engineers.
Try taking a tour of the plant in Georgetown KY as I did, and your eyes will
be opened. The Camrys, Avalons and Solaras begin as rolls of steel and come
out the other end as ready to drive. If that's not 'manufacturing', I
don't know what is. One example - they used to contract out the bumper
assemblies (to a USA supplier) until they found they could make them better,
faster and cheaper in their own plant, so now they do. They have (or had
last year) 77 parts suppliers, with plants in the USA.
However, I don't know how well the Toyota plant (TMMK) is liked in the
Georgetown area, aside from the fact that the high school football stadium
is named......................Toyota Stadium.
Of their 8000 employees and 2000 contract employees, 24% are women, 24% are
college graduates, and less than 1% are Japanese.
Toyota in Kentucky pays the same wages as the big three. Nissan in Symrna,
Tennessee also pays competitive wages to the big three. Or what used to be
the big three. Canton, Mississippi does pay a lower wage, they have a real
depressed economy there and are more willing to work for lower pay. Although
they have problem hiring people there because they fail the drug test. The
difference as I see it is Toyota and Nissan are smart enough to bring steel
in one door and ship a completed car out the other. I have been in all the
plants (we supply equipment to all of them) and Toyota and Nissan are just
ran smarter. They don't pay that much less, but make use of what they pay.
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