State of the Union: Corporations Continue to Flee

January 29, 2014

Last night, the President said this about corporate tax reform:

“Both Democrats and Republicans have argued that our tax code is riddled with wasteful, complicated loopholes that punish businesses investing here, and reward companies that keep profits abroad.  Let’s flip that equation.  Let’s work together to close those loopholes, end those incentives to ship jobs overseas, and lower tax rates for businesses that create jobs here at home.”

Meanwhile, Chrysler said this about corporate tax reform:

Fiat announced the merged company would be named Fiat Chrysler Automobiles N.V., a Dutch firm (also known as a Dutch NewCo), though for tax purposes it will be considered a resident of Britain.

And the pharmaceutical company Actavis, formerly of New Jersey, said this:

Two months after Actavis announced the reincorporation to Ireland, Gilbert, the Bank of America analyst, asked on a conference call if [CEO] Bisaro could comment on the “tax rate land grab that is going on.”

“Unfortunately we have a tax structure in the United States that’s putting companies in the U.S. at a disadvantage,” Bisaro said. “We won’t be at a disadvantage anymore. And I think other companies have to take a look at that. It just makes economic sense.”

And Bloomberg said this:

Since 2012, at least 13 large U.S. companies have announced or completed shifts of legal address, which tax experts call “inversions,” to lower-tax nations such as Ireland and Switzerland…

So many pharmaceutical companies are switching addresses that bankers are pitching takeovers of Irish drugmakers based on the tax benefits. Gregg Gilbert, a Bank of America Corp. drug analyst, dubbed it a “tax rate land grab.”

And Jim Beam said Sayonara:

And the OECD said this:

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