Every big company selling IT services or software plays shell games like this. Incorporate in a state with little to no B&O tax like Delaware, package any product in the state with no manufacturing or assembly tax, book all your sales from a state with no sales tax, send a large chunk of work out of country to a ‘lab’ where tax incentives may be had, but sourced through a subsidiary in a different country with favorable trade agreements to avoid paying tariffs or VAT, etc.
Microsoft got caught doing this with packaged software a long time ago, booking sales through Nevada to avoid paying WA taxes, etc
Add to that the tax incentives of hiring H1Bs, and now you know what the prerequisite to being a CFO at one of those companies really is about.
Visa’s subsidiaries CyberSource could have been a poster child for doing all of this, including blatant on-shoring, their IT staff is, or was, like 95% Indian twenty years ago, spreading business operations around the country, to Ireland, The Netherlands, India, etc, while their linked subsidiary Authorize.net just spread it around from their PO Box HQ on the east coast, through Utah, to WA State, and a few strategically placed execs with PO Box offices, and back around again.
Every big company selling IT services or software plays shell games like this. Incorporate in a state with little to no B&O tax like Delaware, package any product in the state with no manufacturing or assembly tax, book all your sales from a state with no sales tax, send a large chunk of work out of country to a ‘lab’ where tax incentives may be had, but sourced through a subsidiary in a different country with favorable trade agreements to avoid paying tariffs or VAT, etc.
Microsoft got caught doing this with packaged software a long time ago, booking sales through Nevada to avoid paying WA taxes, etc
A commonly known version I always recalled was the double Dutch with an Irish twist, or *double Irish Dutch sandwich” - https://conversableeconomist.com/2024/09/12/the-double-irish-dutch-sandwich-end-of-a-tax-evasion-strategy/
Add to that the tax incentives of hiring H1Bs, and now you know what the prerequisite to being a CFO at one of those companies really is about.
Visa’s subsidiaries CyberSource could have been a poster child for doing all of this, including blatant on-shoring, their IT staff is, or was, like 95% Indian twenty years ago, spreading business operations around the country, to Ireland, The Netherlands, India, etc, while their linked subsidiary Authorize.net just spread it around from their PO Box HQ on the east coast, through Utah, to WA State, and a few strategically placed execs with PO Box offices, and back around again.