Opti
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Post by Opti on Nov 24, 2015 13:24:51 GMT -5
www.msn.com/en-us/news/politics/us-politicians-slam-tax-avoiding-pfizer-allergan-deal/ar-BBnmzJH?li=BBnb7Kz&ocid=iehp
U.S. politicians condemned Pfizer Inc's deal with Allergan Plc as a tax dodge on Monday, bringing another round of hand-wringing in Washington over the corporate tax code, though legislative action before 2017 is unlikely.
Democrats heaped the most criticism on the New York-based drug maker, with Hillary Clinton accusing Pfizer of using legal loopholes to avoid its "fair share" of taxes in a deal that she said "will leave U.S. taxpayers holding the bag."
Republican front-runner Donald Trump, who has called for a corporate tax overhaul, called the deal "disgusting" in a statement, saying "our politicians should be ashamed."
Pfizer is doing the largest inversion deal of all time. In a $160-billion transaction, it plans to move its tax address from the United States to Ireland, if only on paper, by buying and merging into Allergan, a smaller, Dublin-based competitor.
The combined company will be called Pfizer and will be run by Pfizer's CEO, with executive management staying in New York and extensive operations across the United States, but it will no longer be taxed as a U.S. company.
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bean29
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Post by bean29 on Nov 24, 2015 15:26:44 GMT -5
My Brother's company also did this earlier this year. I am sure there is a huge loss in tax revenue.
It is hard to believe that we can't do anything to bring in the "lost" tax revenue - we will probably end up with some sort of VAT.
The article I read said this is a huge concern for countires around the world, because it has the potential to really increase drug prices.
We need to start limiting drug prices like other countries around the world do. No more footing the bill for research for the rest of the world. The piggy bank is empty.
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verrip1
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Post by verrip1 on Nov 24, 2015 17:48:12 GMT -5
If the merger resulted in Allergan being taxed in the US rather than its native Ireland, then the Irish could just as well whine about their tax losses. One way or another, somebody gonna be pissed. So, the combined company can't win no matter which they choose, so they go to the country with the cheapest tax rate by using inversion.
They'd be stupid if they didn't.
Leave it to the politicians to utilize jingoism to oppose this. It demonstrates what Winston Churchill once called an "obvious lack of intellectual vigor".
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verrip1
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Post by verrip1 on Nov 24, 2015 17:52:10 GMT -5
I wonder if the US hand wringing will extend to a Canadian Pacific acquisition of Norfolk Southern?
Janus anyone?
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Virgil Showlion
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Post by Virgil Showlion on Nov 24, 2015 18:05:53 GMT -5
What else can be said?
Businesses exist to make money, not to pay taxes. Maybe the world would be a better place if that wasn't true, but it is, and business decisions are going to reflect that.
In Pfizer's defense, US corporate taxes have to be pretty punishing for them to go through with this. The inversion itself has to be expensive and risks alienating the American public, but they're willing to stake $160 billion on it.
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violagirl
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Post by violagirl on Nov 24, 2015 19:58:55 GMT -5
Governments should stop whining about corporations not paying their "fair" share of tax. The governments are the ones who write the rules. You can't blame corporations for doing what they are legally allowed to do. Do you not take dependent exemptions if you have kids because it wouldn't be fair for you to take them because other people don't have kids and don't get the extra exemptions? No. It is your legal right to take - so you take it.
The high corporate tax rates in the US are the real issue. They have the highest corporate tax rates in the OECD. So yeah, if I can move my profits to a lower taxed locale to defer taxes for awhile..then yes, I'd do it too.
These articles always make it sound like these corporations are never paying any tax anywhere. Yes they have corporate taxes in Ireland and the corporation would be paying tax there. Lower rates, but still paying their "fair" share of Irish taxes. And if they want to bring money back to the US they will pay tax in the US.
Better to make the US a more favorable place to do business rather than trying to run around and beat people with sticks for doing perfectly legal transactions.
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fishy999
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Post by fishy999 on Nov 24, 2015 20:56:00 GMT -5
Lobbyists write the rules- at least in the USA.
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Opti
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Post by Opti on Nov 24, 2015 21:19:45 GMT -5
If the merger resulted in Allergan being taxed in the US rather than its native Ireland, then the Irish could just as well whine about their tax losses. One way or another, somebody gonna be pissed. So, the combined company can't win no matter which they choose, so they go to the country with the cheapest tax rate by using inversion. They'd be stupid if they didn't. Leave it to the politicians to utilize jingoism to oppose this. It demonstrates what Winston Churchill once called an "obvious lack of intellectual vigor". The few years I've paid attention to Pfizer's taxes, they did pretty well at paying very little federal tax. This is pure tax strategy. The combined company will be renamed Pfizer when the merger completes. Pfizer is more than double the size of Allergan employee-wise though the revenue picture is unclearer to me skimming the Wikipedia pages of both companies.
Before this happens, I think American should stop funding research for the world's pharma. Maybe now Ireland and other countries can pick up the slack.
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verrip1
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Post by verrip1 on Nov 25, 2015 13:13:50 GMT -5
If the merger resulted in Allergan being taxed in the US rather than its native Ireland, then the Irish could just as well whine about their tax losses. One way or another, somebody gonna be pissed. So, the combined company can't win no matter which they choose, so they go to the country with the cheapest tax rate by using inversion. They'd be stupid if they didn't. Leave it to the politicians to utilize jingoism to oppose this. It demonstrates what Winston Churchill once called an "obvious lack of intellectual vigor". The few years I've paid attention to Pfizer's taxes, they did pretty well at paying very little federal tax. This is pure tax strategy. The combined company will be renamed Pfizer when the merger completes. Pfizer is more than double the size of Allergan employee-wise though the revenue picture is unclearer to me skimming the Wikipedia pages of both companies.
Before this happens, I think American should stop funding research for the world's pharma. Maybe now Ireland and other countries can pick up the slack.
Whodathunk? You're supporting a reduction of government. It's a start.
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verrip1
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Post by verrip1 on Nov 25, 2015 13:14:39 GMT -5
Lobbyists write the rules- at least in the USA. See my avatar.
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