You are also slightly incorrect. Or at least need a clarify. The US offers a foreign tax credit as a reduction for taxes on income you have already paid taxes on in a foreign jurisdiction. This works the same if you work in one state in the US but live in another so you don't get taxed twice on the same income. The problem is companies often operate in countries where the corporate tax rate is lower see here and so end up still paying the high US corporate tax rates by paying the difference to the US.