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Suppose that a subsidiary operates in a foreign country with a corporate tax rate of 42% and a withholding tax on dividends of 5%. If

Suppose that a subsidiary operates in a foreign country with a corporate tax rate of 42% and a withholding tax on dividends of 5%. If the foreign parent has surplus foreign tax credits, what is the marginal rate of tax on remitted profits from the subsidiary?

d) 5% <- answer : WHY?

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