Rising Sun - it's a GOOD thing!

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 governments costs

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? ;)

mike

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 the plant.

It would collect lots of taxes, not just the taxes directly from the company.

Local and state governments do this often, whether or not the company was an American company.

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.

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 advertisements

mike

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. ;)

mike

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.

"George Orwell" wrote in message news: snipped-for-privacy@mixmaster.it...