For sometime I had posted a query here on correctness of INFY when it classified US payroll taxes as Income tax in India.
I got some clarifications from a friend. This friend in turn got the clarification from some tax expert
Here is the crux of the matter.
- Payroll taxes are mandatory deductions
- These are redeemable only when a person stays in US for 10 years or more
and Here is what INFY would argue,
- INFY employees go to US only on short term
- INFY employees comeback after the assignment and hence payroll taxes are not redeemed by employee and are lost forever- Thus payroll taxes are more like a tax on INFY rather than a PF contributions which are owned by employee
Well that perhaps explains how INFY can get away. I see a good reasoning here.
But my original query still remains..
AmEricAdalli tax kottidakke , MurthygaLu Indiadalli YAke hArAdOdu!!