More and more companies are establishing corporate headquarters overseas in counties offering significantly lower tax rates, a process called tax inversion. Burger King is one of the latest high profile company’s which is planning to move their corporate headquarters to Canada where the corporate tax is 27 percent. James Henry, former chief economist of McKinsey & Company, noted that because Canada has a territorial corporate income tax structure, the US treasury will not receive any taxes from Burger King’s 6,000 overseas locations.
The Obama administration estimated tax inversions cost the U.S. as much as $17 billion each year. Corporate inversions are a growing menace. From 1983 to 2004 there were only 27. Just last year there are at least 50 under consideration. Ireland is a favorite tax haven where the tax rate is 12 per cent. In a recent article in Rolling Stones, entitled "The Biggest Tax Scam Ever" Tim Dickerson describes “how top U.S. companies are avoiding hundreds of billions of dollars parking their profits abroad — and still receiving more congressionally approved incentives.” Top offenders include Microsoft, Big Pharma, Big Oil, Big Tobacco, Wal-Mart, McDonald, and Caterpillar.
General Electric enjoys an effective rate of 4 percent – 31 percent below the U.S. tax rate. Meanwhile our schools, basic infracture continue to suffer with declining federal tax revenues. The oligarchs have a chokehold on our declining democracy. Citizens it is time raise your voices.