I thought I was clear when I said withholding on "income" rather than cap gains (no tax there), but I guess I could have been more explicit. LuisHK is right on and confirms my understanding of the issues. I'm also in a tax-friendly jurisdiction. I've also had mix results in looking at some of these foreign ETFs for the reasons Luis mentions and also because their tax treatment isn't always completely clear. This isn't a huge issue on equity ETFs but definitely ate into my returns over the past couple of yeas on things like JNK and being taxed in the US on something like EMB (foreign bonds) is retarded. Even if perhaps recoverable, the process of doing so is often more trouble than it's worth. Thanks for the link comintel; will check some of those out too.