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Old 08-01-2007, 06:46 AM
  #17  
HerkyBird
Gets Weekends Off
 
Joined APC: Sep 2006
Posts: 118
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In fact, the 17% HKG tax you'll be paying isn't even going to the Chinese gov't. -- it's going back to FedEx. Foreign companies have to sign a commitment to pay the Chines gov't. an amount equal to 17% of the expat employees' pay. It's a cost of doing business, and it's not unusual at all. What IS unusual (I would say even reprehensible) is that FDX is making a grab at your check to partially offset that cost of doing business ... by withholding "HKG tax" from your check in an amount up to what you'd be paying if you lived in the U.S. What it means is that even though when you file your Federal tax return, Uncle Sam still gives you the Foreign Earned Income Exclusion (FEIE) of about $82K (for 2007), you effectively lost that when FDX took some of it to help defray what they're on the hook for to the Chinese gov't. You think they put us in HKG because it's cleaner and we'd have more fun? Hah, you dreamer. They put us in HKG because the commitment they'd have to sign on for if we were living in CAN (Guangzhou) is more like 51% of our pay, and there was no way we'd tolerate giving up that much pay -- they knew they'd never be able to pull it off. But if they put up a smokescreen, we just might bite off on 17%, up to the level we'd be paying if we lived in the States, anyway. Why would you move overseas and give up a benefit Uncle Sam gives you for going there in furtherance of the business interests of a U.S. corporation? Not just give it up -- but HAND IT OVER TO YOUR EMPLOYER??? Are you out of your mind?
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