I heard this the other day and I’m wondering if it’s true. I feel like there’s a technical term I’m missing which would help in a search. Paraphrased:
If a company has multiple locations within the United States and sends material from a site in state A to state B for some purpose, then it gets sent back to the original state A that’s not considered interstate trade for the end of year numbers.
If a multinational does the same internal shuffling of materials across different countries this is considered trade – import/export – even if the final product is sold in the original country only. This sort of internal movement of material inside a company makes up a large part of what’s considered international trade, maybe 30 or 40%.
Is that true?
It depends. Reporting of this type of information is usually solicited by the government and is subject to the reporting rules established for those purposes. Many companies may consider a transfer of product from plant A in State 1 to plant B in State 2 a stock transfer and not record it as a sale of product from one location to another. Other companies may record such transfers in a way that they are easy to track and report for interstate commerce purposes.
The reason it is easier for companies to report their exports of products to their affiliates out of the country, is that they are normally transfers between different legal entities, whereas transfers such as the one I described above, are probably transfers within the same legal entity.
So it depends.