|English to Chinese: Private Equity|
General field: Bus/Financial
Detailed field: Finance (general)
|Source text - English|
Tax has always been central to private-equity business models. The industry uses large amounts of debt, interest on which is tax-deductible, to acquire companies. So it has long been adept at minimising tax, both by making full use of deductions, and through the careful choice of corporate structure. Historically, private-equity firms have been partnerships, also known as “pass-throughs”, because profits pass through them untaxed (to beneficiaries who then pay income tax). Indeed, carried interest, whereby private-equity firms’ profits are taxed at the rate imposed on capital gains, rather than that on income, only applies to partnerships. But the firms that private equity acquires (“portfolio companies”) have been a mix of partnerships and C corporations.
|Translation - Chinese|