Less than two weeks before an investment firm controlled by Mitt Romney decided to invest in a China-based home appliance company, the company put out a detailed document to investors touting itself as a low-wage, low-tax firm that would not be subject to taxes in the United States. It used “inexpensive labor,” Global-Tech Appliances wrote in a prospectus meant to drum up businesses on April 8, 1998. Its location in China meant “an overall effective tax rate that may be less than that of US corporations.” It said its current operations would not be subject to “material US taxes because it should not be considered to have significant income effectively connected with a trade or business in the US.”
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