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Jon_King - 7:18 pm on Mar 27, 2005 (gmt 0)
You may be incorrect about your situation. The only thing I can find: 1) They will hold all money until the proper form has been completed with them. 2) They are not responsible for anything thing tax related (except for the form), it is completely in the hands of the Publisher to know their specifc tax laws.
I can find nothing at all about tax withholding in the AdSense FAQ or via a search of the site.