The ABC Corporation is a large multinational company that hasfacilities (both manufacturing and distribution) located in manyU.S. states and in overseas countries. The corporation’slong-serving chief financial officer (CFO) just retired, and hisreplacement is reviewing the corporation’s economic balance sheet.She discovers that the corporation leases many of its distributionfacilities and relies heavily on long-term debt for financing. Shevaguely recalls having heard about implicit taxes and taxclienteles and would like these concepts explained and then appliedto her observations to determine if the corporation is bearingimplicit taxes and whether the corporation is in the rightclientele.
