The Purpose of a Withholding Tax on Dividend Income Is

question 55

Multiple Choice

The purpose of a withholding tax on dividend income is to

• A) raise the effective as rate of the local host country.
• B) provide an incentive for MNEs to pay higher dividends to their parent companies.
• C) obtain a minimum tax payment on the incomes of dividend income receipts.
• D) encourage MNEs to reposition profits outside of their countries.

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