Qualcomm Moderated Thread - please read rules before posting Message Board

To: Jim Mullens who wrote (42971)	10/31/2004 12:32:12 PM
From: quartersawyer	Read Replies (2) of 117475

Jim-- re: <The provision reduces for one year the federal tax on profits earned overseas from a maximum 35 percent to 5.25 percent. <<<<<<<<<<<<<< It would appear that Qualcomm would benefit significantly from the “tax holiday” on foreign profits (@ 5.25%) since a significant amount of their revenue is earned overseas. I’ve been informed that the one year “tax holiday” would be for the 2005 tax year, although the article does not stipulate such.> It might not work that way. From the Oct. 13 WSJ: "Over the past decade companies have grown increasingly skilled at sheltering foreign profits offshore by labeling them permanent investments, producing a huge pool of capital. US firms have long argued that what they see as high taxes on overseas profit, which most other developed countries do not impose, hamper their ability to compete. The new law would let American companies bring home for one year, at the 5.25% rate, the total amount of undistributed foreign earnings disclosed to the SEC prior to June 30, 2003. The funds can be spent for any purpose other than executive compensation, but companies must create a "domestic reinvestment plan" approved by senior management and directors." If Q has those undistributed earnings kicking around over there, a buyback or extra dividend would pass muster.