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发帖数: 2478 | 1 http://www.breitbart.com/Big-Government/2014/04/28/Pfizer-to-Re
In a huge rejection of the United States's corporate income tax rate – the
highest in the world – America’s second-largest drug company, Pfizer, Inc.
, just proposed a merger with Britain’s AstraZeneca that would move the
company away from New York’s combined 42.1% corporate rate and into the
United Kingdom’s 20% rate.
Pfizer has been based in New York City since its founding in 1849.
Pfizer's plan is what economists refer to as a “reverse merger.” Pfizer
would buy AstraZeneca for $98.6 billion and reincorporate in the UK, with
shares listed on the New York Stock Exchange. Pfizer said the tax structure
would protect AstraZeneca's revenues from the 39.1% average corporate tax
across the US. Pfizer would benefit from its international business being
taxed at the current British corporate tax of 21% this year, scheduled to
fall to 20% next year.
Ian Read, Pfizer's Scottish-born Chief Executive, said that the proposed
deal would let Pfizer eliminate “redundant functions” and overlapping
operations. "Redundant functions" is business-speak for dumping staff at the
New York corporate headquarters. The company already sold its 685 Third
Avenue New York City office building in 2010 for $190 million. Currently, 4,
400 employees are consolidated at the company’s world headquarters at 235
East 42nd Street, near Grand Central Terminal.
A spokesman for U.K. Prime Minister David Cameron seemed delighted at the
creation of the world’s largest pharmaceutical company in Britain: “The
fact Britain has an open trade-based economy which is open both to
investment but also British firms investing overseas, that is a strength to
the UK.”
U.S. corporations are at a competitive disadvantage in today’s globalized
world. According to the Tax Foundation, American companies face the highest
statutory corporate income tax rate in the world at 39.1%. This overall rate
is a combination of our 35% federal rate and the average 4.1% rate levied
by U.S. states. Pfizer, as a company headquartered in New York, also pays
New York's corporate tax of 7.1%, so Pfizer’s combined state and federal
rate is 42.1%
Corporations headquartered in the 33 other industrialized countries that
make up the Organization for Economic Cooperation and Development (OECD),
however, face an average rate of 25%. Even corporations in high-tax European
countries such as Belgium (34%), France (34.4%), and Sweden (22%) face much
lower rates than those in the United States.
Pfizer first contacted AstraZeneca in January and again on April 26th, but
has been rebuffed so far. Given the enormous tax benefits of the merger,
many analysts expect Pfizer to raise its bid to over $100 billion. A deal
would allow Pfizer to also use some of the $70 billion in cash it has built
up overseas that would be subject to taxes if brought back to the U.S.
Buying AstraZeneca would boost Pfizer's pipeline of cancer drugs and create
significant cost and tax savings.
Whatever the outcome of the Pfizer/AstraZeneca merger, the exit of U.S.
companies to escape the highest corporate tax rate in the world has begun. |
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