NEW YORK, March 27 (UPI) -- U.S. stock indexes slipped Wednesday following downturns in markets across Europe.
The European Commission said Wednesday that economic sentiment indexes for the eurozone and the European Union fell in March, especially in three of the region's largest economies -- France, Germany and Spain.
Markets were higher across Asia but down in France, Germany, Italy, Britain, Belgium and Sweden.
On Wall Street, the Dow Jones industrial average was off 35.76 points -- 0.25 percent -- to 14,523.89.
The S&P 500 gave up 3.08 points, 0.2 percent, to 1,560.69.
The tech-oriented Nasdaq composite index shed 3.72 points, 0.11 percent, to 3,248.77.
Ten-year U.S. treasury bonds rose 17/32 to yield 1.858 percent.
Against the dollar, the euro fell to $1.2766 from Tuesday's $1.286. Against the yen, the dollar rose to 94.46 yen from 94.45 yen.
In Tokyo, the Nikkei 225 index added 0.18 percent, 22.17 points, to 12,493.79.
Blue-chip firms master the tax game
WASHINGTON, March 27 (UPI) -- The percentage of profits paid in taxes by U.S. multinationals has diminished sharply in recent years, records of blue-chip corporations indicate.
Research firm S&P Capital IQ said companies included in the Dow Jones industrial average -- a select group with representatives from most major business sectors -- are paying about half the federal tax rate they were paying in the late 1960s.
In the late 1960s they were paying 25-50 percent of their worldwide profits to the Internal Revenue Service, The Washington Post reported Wednesday.
But that was then.
The biggest change over the years, studies indicate, isn't the corporate tax rate, although that has diminished sharply with the top rate falling from 48 percent in 1971 to the current 35 percent.
The more significant change is the globalization of the multinationals and their understanding of how to move profits to show up in countries with advantageous rates, the Post said.
A study by the Congressional Research Service released in January revealed that among U.S. multinational corporations in 2008 more than 40 percent of their overseas profits were reported in Bermuda, Ireland, Luxembourg, the Netherlands and Switzerland -- countries that are neither production centers nor the location of most of their overseas administrative employees.
Examples of corporate gamesmanship abound. One Senate subcommittee said Dow component Microsoft assigned almost half of its net revenue from U.S. sales from 2009 to 2011 to a subsidiary in Puerto Rico, where it had transferred ownership of various intellectual property rights.
The same study by the Subcommittee on Investigations said that corporate profits reported in 2008 in Bermuda came to 1,000 percent of the country's gross domestic product. Nine years before that, profits reported in Bermuda came to 260 percent of the country's GDP, the report said.
Franchise restaurant giant McDonald's in 1973 paid more than 37 percent of its worldwide profits in U.S. federal taxes. That dropped to 14 percent in 2012.
United Technologies has seen an even sharper drop in its effective U.S. tax rate. In 1969, it paid 47 percent of its profits in federal taxes. That has fallen to 5.8 percent, the Post reported.
Corporate tax expert Robert Willens said profits provided the motivation for keeping taxes low, but the government was not making the maneuvering hard to do.
"I think people realize now that it's not difficult to avoid U.S. taxes ... and investors are demanding consistently improving performance," he said.
Japan Cabinet approves stopgap budget
TOKYO, March 27 (UPI) -- The Japanese Cabinet Wednesday approved a 13.2 trillion yen provisional budget to cover spending for 50 days beginning April 1.
The stopgap budget was sought by the government of Prime Minister Shinzo Abe since the annual budget for next fiscal starting April 1 is not expected to be enacted before May.
Kyodo News reported the 13.2 trillion yen provision is the largest ever such stopgap arrangement, topping the 11.6 trillion yen in fiscal 1996. The money is needed to fund pensions and major public works projects designed to stimulate the economy.
The drawing up of the new budget for next fiscal was delayed since Abe's Liberal Democratic Party-led government took over only on Dec. 26 after the Dec. 16 general election.
The Finance Ministry said about 5.43 trillion yen of the stopgap budget will go to fund social security spending, and another 1.54 trillion yen for public works projects.
For next fiscal, the government already has submitted to Parliament a record 92.61 trillion yen budget.
BRICS nations to have development bank
DURBAN, South Africa, March 27 (UPI) -- The BRICS nations of Brazil, Russia, India, China and South Africa agreed to set up a bank for infrastructure development, China's finance minister said.
Speaking in Durban, South Africa, site of the fifth summit of the BRICS nations, Chinese Finance Minister Lou Jiwei confirmed the agreement on the bank during a meeting of fellow financial ministers of the five countries.
He said the ministers "have agreed that the set-up of the development bank is feasible and reasonable," the official Chinese Xinhua News Agency reported.
Lou said it was agreed a bank to fund infrastructure projects in the member nations is needed, but that the meeting did not discuss details like initial investment of each country to the bank.
"What we have now is just a general picture," Lou said, adding details may be worked out by next year.
The Chinese minister, apparently allaying any concern a BRICS bank might challenge institutions such as the U.S.-led World Bank or the Asian Development Bank, said the bank would complement such existing institutions.
However, Lou also said the current global economic situation remains complicated and such steps as quantitative easing have created an unfavorable external environment for the BRICS nations.
Separately, the China Daily, quoting Jim O'Neill, chairman of Goldman Sachs Asset management who is credited with coining the BRICS acronym, said a BRICS bank could help promote more trade among the countries making up the group.
"If, in fact, the BRICS bank is announced, this will be the beginning of an institution that sort of becomes a World Bank for their huge sphere of influence," O'Neill told China Daily in an interview.
The bank concept evolved last year at the New Delhi BRICS summit as a way to promote long-term investment possibilities through pooled funds for targeted infrastructure projects, while supporting increased commerce between the BRICS and other emerging economies.
O'Neill was quoted as saying the BRICS countries, other than South Africa, have grown much bigger more quickly than he had expected despite some loss of momentum in the past year. In 2011, the combined BRICS GDP increased by $2.3 trillion.
"By 2015, if not before, the combined size of the BRICS economies seems highly likely to become as big as the U.S. and they are set to become as big as the G7, as we assume, by 2027," O'Neill said. "It is transforming everything in the world economy, including the patterns of world trade and finance."
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