tax breaks
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Is there really that much of a difference between offering tax breaks and other countries offering low wages? Both locales are offering what they have available, tax control vs. wage control. Both would benefit greatly from the added income, but the foreign country would result in a much larger profit margin.
So, if you were part of the management team trying to decide between moving to West Virginia or the West Indies... What would be the considerations that would matter most to you? How do you think you'd ultimately decide?
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The solution discusses if there really that much of a difference between offering tax breaks and other countries offering low wages.
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Yes, you are right that tax breaks cannot match the profit margin generated due to offshore outsourcing, as the differences in cost of labor can often yield as high as 75% cost savings, which is ...
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- BCom, SGTB Khalsa College, University of Delhi
- MBA, Rochester Institute of Technology
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