Defense contracting : recent law has impacted contractor use of offshore subsidiaries to avoid certain payroll taxes : report to congressional committees.

Format:

Book

Government document

Author/Creator:

United States. Government Accountability Office

Language:

English

Subjects (All):

Defense contracts--United States.

Defense contracts.

Offshore outsourcing--Evaluation.

Offshore outsourcing.

Public contracts--United States.

Public contracts.

Taxation--Law and legislation--United States.

Taxation.

Payrolls--Taxation--United States.

Payrolls.

Unemployment insurance--United States.

Unemployment insurance.

Government contractors--Taxation--United States.

Government contractors.

Government contractors--Taxation.

Taxation--Law and legislation.

United States.

Physical Description:

1 online resource (iii, 23 pages) : illustrations

Other Title:

Recent law has impacted contractor use of offshore subsidiaries to avoid payroll taxes

Place of Publication:

[Washington, D.C.] : U.S. Govt. Accountability Office, [2010]

Summary:

Many federal contractors establish offshore subsidiaries to take advantage of labor and market conditions. GAO has found that they also use offshore subsidiaries to reduce their U.S. tax burdens. In 2008, Congress passed the Heroes Earnings Assistance and Relief Tax (HEART) Act which resulted in contractor offshore subsidiaries paying certain payroll taxes for U.S. personnel working abroad. Fiscal year 2009's National Defense Authorization Act required GAO to report on the rationales, implications, and costs and benefits of defense contractors' use of offshore subsidiaries. We (1) assessed trends and purposes for contractors' offshore subsidiaries; (2) identified how contractors use subsidiaries to support defense contracts; (3) assessed DOD's oversight of contractors' use of offshore subsidiaries. To conduct our work, we reviewed data for the 29 U.S. publicly traded contractors with at least $1 billion in DOD spending in fiscal year 2008, reviewed several illustrative contracts selected based on categories of DOD services most often performed overseas, reviewed audit documents, and interviewed DOD officials about oversight. Congress should consider whether further legislative action is needed to address contractor avoidance of unemployment taxes for U.S. workers.

Notes:

Title from cover screen (GAO, viewed Jan. 27, 2010).

"January 2010."

Includes bibliographical references.

"GAO-10-327."

OCLC:

502171762