3. Taxation of Foreign Source Income (B-intermediate). Referring to problem 2, consider the case of Fluor’s wholly owned subsidiary in Ireland, which is taxed at the corporate income tax rate of 12.5 percent. Fluor-Ireland earned $27 million in 2012.

a. How much in taxes is Fluor-USA liable for on its earnings generated by Fluor-

Ireland?

b. Assuming that Fluor decides to repatriate 100 percent of profits earned in Ireland, would Fluor’s global tax bill change?

c. Assuming that both Fluor-Brazil and Fluor-USA decide to repatriate 100 percent of their profits to their U.S. parent, what would be Fluor’s global tax bill?