Taxing Government Contractors In Afghanistan

Law360, New York (May 11, 2011, 3:51 PM EDT) -- As recently as April 2011, Afghanistan indicated that it plans to require certain U.S. prime contractors and subcontractors performing work in Afghanistan under U.S. government contracts to pay Afghan income tax.[1]

This requirement could force affected U.S. corporations to either pay significant sums to the Afghan government or risk additional monetary penalty and disruption in business operations, including the loss of a contractor’s Afghan business license. Further complicating this issue is that the U.S. government has signaled its position that both U.S. prime contractors and subcontractors...
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