What is the effective tax rate on the inter-company dividend

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Question - A holding company sells shares in its subsidiary which lowers its ownership to only 42%, thus, the tax returns of the parent and its subsidiary can no longer be consolidated. If the parent company's marginal tax rate is 34% and if the exclusion on inter-company dividends is 70%, what is the effective tax rate on the inter-company dividends?

Reference no: EM132600652

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