6.1.2 Profit repatriation and tax avoidance

Content

Geographic inquiry and concept(s)
- How technological and globalizing processes create new geopolitical and economic risks for individuals and societies
Geographic knowledge and understanding
- New and emerging threats to the political and economic sovereignty of states: profit repatriation and tax avoidance by TNCs and wealthy individuals
Case study or detailed examples
- Neither required by the syllabus
Aims of this lesson
- To have knowledge and understanding of profit repatriation and tax avoidance by TNCs and wealthy individuals as threats to the political and economic sovereignty of states.

Analysis finds Amazon, Meta, Alphabet, Netflix, Apple and Microsoft averaged 18.8%, compared with 29.7% US average

The Guardian · 14 April 2025

Corporation tax
- A direct tax imposed on the net income or profit that enterprises make from their businesses.

Offshore tax haven
- A country that offers foreign businesses and individuals minimal or no tax liability for their bank deposits in a politically and economically stable environment. They have tax advantages for corporations and for the very wealthy, and obvious potential for misuse in illegal tax avoidance schemes.

Profit repatriation
- The ability of a firm to send foreign‐earned profits or financial assets back to the firm's home country in hard currency such as USD, EUR and others, after meeting the host nation's tax obligations.

Tax avoidance
- Any legal method used by a taxpayer to minimise the amount of income tax owed. Individual taxpayers and corporations can use forms of tax avoidance to lower their tax bills.

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