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Taxable presence

International trading companies need to be alert to the possibility that their transactions may inadvertently create a taxable presence in a country.

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International trading companies need to be alert to the possibility that their transactions may inadvertently create a taxable presence in a country for income, or indirect taxes, or both.

The tax authorities in Greece, for example, are aggressively seeking to tax their share of global commodity activities among other things by targeting ex-ship transactions in which products are delivered aboard a ship in a specified country.

In some countries, such as Peru, a foreign company can create a taxable presence merely by taking title to goods in the country. The level of business activity that creates a connection to a country varies substantially.

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Fundamentals of International Business

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