You’ve heard this story before, here’s another one:
A big U.S. drug company, AbbVie Inc., has purchased an Irish company
and plans to re-incorporate in Great Britain, so it can cut its corporate tax
bill by almost 50 percent.
Smart move, right?
Well, how about these apples?
For starters, AbbVie is currently paying an effective tax rate of only about
22 percent—forget the disingenuous squealing blather about the “high” nominal
federal tax rate of 35 percent, almost no company pays that rate on its income
after corporate tax breaks are factored in.
And this one: Yahoo Finance points out that Sen. Dick Durbin (D-IL)
called out AbbVie for moving “after using taxpayer-supported medical research
to become one of the United States’ most profitable companies.” The federal
government provides almost $35 billion a year to subsidize drug research by Big
Pharma.
And this one: Durbin also said "It was our government’s patent
office which protected their discoveries and guarded their right to make a
profit. Now AbbVie is ‘moving’ to an Irish island to escape paying the U.S.
taxes it owes.”
Corporations are not people.
Corporations are wholly artificial creations of human beings and society
and the governments which protect and regulate them.
For starters, our government should institute a “clawback” policy for
the tax breaks and subsidies provided to business: if you legally move your
business to a tax haven outside the United States, your company has to pay back
all the income-enhancing benefits it enjoyed while under the protection of U.S.
laws.
That’s the ticket.
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