Found on the Internets …
The president held a news conference yesterday as part of the U.S. Africa Leaders Summit. One of the topics was executive actions on inversions.
Q: Along the lines of executive authority, Treasury Secretary Jack Lew has previously said that the executive branch of government doesn’t have the authority to slow or stop corporate inversions, the practice that you have called distasteful, unpatriotic, et cetera. But now he is reviewing options to do so. And this is an issue that a lot of business, probably including some of the ones who were paying a lot of attention to this summit, are interested in. So what I wanted to ask you was, what prompted this apparent reversal? What actions are now under consideration? Will you consider an executive order that would limit or ban such companies from getting federal contracts? And how soon would you like to see Treasury act, given Congress’s schedule?
PRESIDENT OBAMA: Just to review why we’re concerned here. You have accountants going to some big corporations — multinational corporations but that are clearly U.S.-based and have the bulk of their operations in the United States — and these accountants are saying, you know what, we found a great loophole — if you just flip your citizenship to another country, even though it’s just a paper transaction, we think we can get you out of paying a whole bunch of taxes.
Well, it’s not fair. It’s not right. The lost revenue to Treasury means it’s got to be made up somewhere, and that typically is going to be a bunch of hardworking Americans who either pay through higher taxes themselves or through reduced services. And in the meantime, the company is still using all the services and all the benefits of effectively being a U.S. corporation; they just decided that they’d go through this paper exercise.
Walgreens Drops Plan To Move Headquarters – And Profits – Overseas
Walgreens Co. will complete its merger with Alliance Boots, a British pharmacy, but it will not move its headquarters overseas to reduce its U.S. tax bill.Walgreens had flirted with the idea of moving its headquarters from Chicago to the United Kingdom to avoid paying corporate taxes in the U.S.
That drew the attention of those who are concerned about profits made in America being taxed overseas, if at all.
“The company concluded it was not in the best, long-term interest of our shareholders to attempt to re-domicile outside the U.S.,” Walgreens CEO Greg Wasson said in a statement.
Yeah. The shareholders who saw images like this, perhaps?
Maybe a pharmaceutical company like Abbott Laboratories can get away with this but companies that deal directly with consumers and which has competition probably should at least pretend to be a good corporate citizen.
More …
Another Billion-Dollar US Company Moves Across The Pond
The AbbVie-Shire deal is the latest in a series of moves by companies in the pharmaceutical industry to shift their corporate domiciles to enjoy more favorable tax treatments.
Earlier this week, Mylan announced a deal to acquire Abbott Laboratories’ non-U.S. developed generic drugs business in a $5.3 billion all-stock deal. The deal involves the creation of a new public company that will be domiciled in the Netherlands, and Mylan said it expects the new company’s tax rate to fall into the high-teens within its first couple years.
Last month, Minnesota-based medical-device maker Medtronic acquired Covidien in a $42.9 billion cash and stock deal that will allow the company to move its tax base to Ireland.
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