INFY Tax Clarification

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!!

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