65 Comments - 47th Ward - Wednesday, Jul 30, 14 @ 10:53 am: ===“Dick Durbin and his job-killing policies have produced the worst economic recovery in U.S. history and this is just more of the same. It is a poor excuse for tax reform and not a serious attempt to fix our country’s anemic economy.”=== And stay off my lawn! - OneMan - Wednesday, Jul 30, 14 @ 10:53 am: No Federal Contracts for Corporate Deserters Act.. Wouldn’t that cause some free trade issues? - North Shore Joe - Wednesday, Jul 30, 14 @ 10:55 am: WAG received $16.7 billion from Medicare and Medicaid last year, which is about 25 percent of its corporate revenues. From my conversations with my Republican friends, I see most people being pro-closing the inversion loophole. If every corporation did this, the tax onus would inevitably be shifted to individuals. What’s this country coming to. SMH. - Yellow Dog Democrat - Wednesday, Jul 30, 14 @ 10:55 am: Stupid, Rauner. This has nothing to do with the business climate in Illinois…it’s not as if they are moving their HQ to Texas. What does Ken Griffin have to say? - wordslinger - Wednesday, Jul 30, 14 @ 10:59 am: –“America needs to compete, Illinois needs to compete. The right answer is not to create walls, to block companies and people,” Rauner said.– Does that apply to the Rio Grande valley, Baron? Your base wants to know. I’m with Bruce on inversion. Since corporations are individuals just like me, I’m changing my mailing address to Switzerland to get out of paying any U.S. taxes. Defend this inversion scam at your risk, Baron. - Yellow Dog Democrat - Wednesday, Jul 30, 14 @ 10:59 am: @North Shore Joe: Exactly the argument Mark Cuban made. Any company that is focused on tax schemes is ignoring the much bigger profit-making opportunities. Like streamlining internal processes or expanding into new markets. - Formerly Known As... - Wednesday, Jul 30, 14 @ 11:00 am: Holy cow. Oberweis with the most truthful and accurate statement out of the 5 comments. - VanillaMan - Wednesday, Jul 30, 14 @ 11:01 am: Oberweis has the right answer! This is a political move that isn’t intended to have an open and honest debate about corporations and taxes. This is a political move designed to target one political party against the other - sadly launched by a White House. So, what Oberweis did was take advantage of this political issue and use it to his political advantage, didn’t he? Instead of being cornered, Oberweis turns the table. He doesn’t address the issue in the terms this president sets up, he addresses the issue the way he wishes to address this political issue. This is a White House political attack. Rauner shouldn’t answer it on the White House’s terms and definitions. Fact is, taxes wouldn’t be getting any attention if the economy was good for America. There wouldn’t be a need to raise any taxes if the current tax structure was producing for the government, the taxes needed to keep it going. If the economy was growing, then the increase in the economic activities would increase taxes as well. Taxes are not fair. Claiming that someone needs to have their taxes raised in order to be “fair” is a subjective statement that can never have an objective answer. When taxes are being raised, it means government is failing. Those who propose to raise taxes have to first acknowledge that they have screwed up. Oberweis gets it. - walker - Wednesday, Jul 30, 14 @ 11:04 am: Rauner’s statement is dramatically stupid. YDD said it better above. My fear is that he might use the same empty “freedom” argument, to evade US taxes on US- earned wealth and income, through his own off-shore accounts, like Mitt. So far there’s no evidence he has done that. That’s why more complete personal tax filings would be specifically relevant in this political choice. - Ron Burgundy - Wednesday, Jul 30, 14 @ 11:06 am: I think all concerned would prefer corporations not do this, or feel like they have to do this. Seems to me a dispute about whether to use the carrot or stick approach. If you’re gonna use the stick of cutting off government contracts to get them back, are you then gonna provide a carrot or a better tax climate once they come back, or are you gonna hit them with the stick again? If so, they may make the determination that it’s not worth it to come back. - Skeptic - Wednesday, Jul 30, 14 @ 11:09 am: wordslinger: That was exactly my idea. Tell ya what, we can split the rent on a storefront in Geneva. - oz - Wednesday, Jul 30, 14 @ 11:10 am: Haha.. It’s fine and dandy for the apparatchik to hand out corporate tax break after corporate tax break leaving the middle class taxpayers to pick up the slack of lost revenue. Yep, as long as they are the one’s in command and control it’s fine. However. When the corporate CEO’s make a move that threatens that control they must be demonized! They can’t stand it! Isn’t this just more extortion anyways? Corporations using the threat of jobs for more tax breaks? Funny not a word when Abbvie of Illinois the largest tax inversion ever and not a word. We only hear about Walgreens. It’s like it’s a staged thing with a phony battle so someone will have a win to put on the board for election time. Like they are fighting for the middle class of something. - Formerly Known As... - Wednesday, Jul 30, 14 @ 11:10 am: During the past few days we have been treated to Assault weapons Tax inversion Taking the one-week minimum wage “challenge” Sheltering unaccompanied children from the border Signing a desperate voter turnout-ballot referendum on a “millionaire’s tax” So good to see such strong answers and focus on addressing our pressing state issues. - wordslinger - Wednesday, Jul 30, 14 @ 11:12 am: –Jamie Dimon, the chief executive of JPMorgan Chase, recently said, “I love America.” Lloyd Blankfein, the chief executive of Goldman Sachs, wrote an opinion article saying, “Investing in America still produces the best return.” Yet guess who’s behind the recent spate of merger deals in which major United States corporations have renounced their citizenship in search of a lower tax bill? Wall Street banks, led by JPMorgan Chase and Goldman Sachs. Investment banks are estimated to have collected, or will soon collect, nearly $1 billion in fees over the last three years advising and persuading American companies to move the address of their headquarters abroad (without actually moving).– http://dealbook.nytimes.com/2014/07/28/banks-cash-in-on-mergers-intended-to-elude-taxes/?ribbon-ad-idx=3&rref=world&module=ArrowsNav&contentCollection=Business%20Day&action=swipe&region=FixedRight&pgtype=Blogs - Precinct Captain - Wednesday, Jul 30, 14 @ 11:15 am: ==- Formerly Known As… - Wednesday, Jul 30, 14 @ 11:00 am:== How you get to that conclusions is beyond reason. Do the other 99 senators not matter? Do they not have an effect an policy? The presidential administration? The thousands of big companies in America? The millions of smaller companies? Consumer demand? None of these matter, just Dick Durbin? ==Taxes are not fair.== How are taxes not fair? Do you understand what funds state jobs, the police, firefighters, roads, etc.? Anarchy and atavism aren’t fair. - Just Me - Wednesday, Jul 30, 14 @ 11:17 am: This is actually an interesting debate. On one side the liberals want more tax revenue to provide more social services; on the other side the conservatives argue that same hunger for as much tax revenue as possible has led to taxes so high it is pushing job creators to find alternatives. - Bill White - Wednesday, Jul 30, 14 @ 11:19 am: And yet, as a percentage of GDP, federal taxes have never lower in my lifetime, or your lifetime. - Ben - Wednesday, Jul 30, 14 @ 11:20 am: Can any of you actually define what a tax inversion does? It does not eliminate US taxes, it eliminates paying them twice and on income not earned in the US. “Fair share” is democrat code for, “as much as we can get away with.” - Jimmy - Wednesday, Jul 30, 14 @ 11:23 am: Rauner was able to game the system and change his address on the fly to send his daughter to an elite Chicago High School even though he voted in the suburbs. Why would he be opposed to allowing corporations to play games with their addresses to reap millions more an profits? Bruce needs to understand that when games like these happen, it’s the middle class that’s on the hook to make up the loss in tax revenues and loses it’s spot at Walter Payton High School. - oz - Wednesday, Jul 30, 14 @ 11:24 am: Remember how coal exports were going to save Illinois economy and create those much needed living wage jobs. Ha. Well, that didn’t last very long. “Illinois coal exports dip in 2013 after sharp rise’ ” CHICAGO — Illinois coal exports have risen sharply in recent years, even as its high sulfur content limits its demand in the U.S. The state Department of Commerce and Economic Opportunity says that about 12 million tons of Illinois coal was exported in 2013. That’s down from the 13 million tons exported in 2012, but far more than the 5.5 million tons exported in 2011 and 2.5 million tons in 2010. Other coal-producing states are seeing similarly strong exports as the U.S. reduces its reliance on coal-burning power plants. But critics say exports are shifting pollution to other countries, some with more lax environmental standards. They say that makes the U.S. appear to be making more progress than it is on global warming. Illinois coal production accounts for about 4,000 jobs.” Read more here: http://www.bnd.com/2014/07/28/3323746/illinois-coal-exports-down-slightly.html#storylink=cpy Smoke and mirrors politics creating the illusion of a get tough stance on global warming. Hilarious. If you allow the coal to be exported and burned overseas it doesn’t effect global warming because it’s out of sight out of mind. Out of control - Willie Stark - Wednesday, Jul 30, 14 @ 11:28 am: What really seems missing in this discussion of inversion is the fact that 18% of federal spending is for defense ($640 billion). Social Security and Medicare/Medicaid are larger portions, but they are to a significant degree supported by employee contributions. Do American corporations appreciate that one of the things that makes it possible for them to reap their fortunes is the Pax Americana and the *relative* degree of stability it brings to the world? Companies may be becoming denationalized, but it’s still a world of nation states whose actions could threaten those companies ability to make money. Speaking for myself, if Walgreens goes, I won’t be going to Walgreens anymore and would strongly consider buying CVS stock, as I expect they would be a prime beneficiary of former Walgreens customers looking for alternatives. - foster brooks - Wednesday, Jul 30, 14 @ 11:30 am: Oberwiess & rauner are thoroughly convinced the tax base should be expanded by creating $14 an hour jobs,and trusting them with you 401k. - Capitol Fax Follower - Wednesday, Jul 30, 14 @ 11:36 am: You can add my name to the long list of former Walgreen patrons who will no longer shop at Walgreens if they go ahead with biting the hand that feeds them - Formerly Known As... - Wednesday, Jul 30, 14 @ 11:37 am: ==- Precinct Captain - Wednesday, Jul 30, 14 @ 11:15 am:== How you get to ==Do the other 99 senators not matter?== and ==None of these matter, just Dick Durbin?==, from ==out of the 5 comments== is the only thing beyond reason. Out of the comments made by Quinn, Rauner, Phelon, Durbin and Oberweis, Oberweis’ was the most truthful and accurate. That was an observation made through the microscope of those 5 comments in this post, not the intergalactic telescope you are using to look at everything from the other 99 senators to consumer demand, none of whom are quoted in this post. - Jimmy - Wednesday, Jul 30, 14 @ 11:39 am: Willie Stark - “Do American corporations appreciate that one of the things that makes it possible for them to reap their fortunes is the Pax Americana and the *relative* degree of stability it brings to the world?” Great point! No one opposes having a debate on corporate tax rates but let’s not let corporations decide themselves whether to opt out of being an American by exploiting legal loopholes. Let’s close the loophole and then have the debate, not the other way around. - Precinct Captain - Wednesday, Jul 30, 14 @ 11:44 am: FKA, the Dairy Man response begins, “Dick Durbin and his job-killing policies have produced the worst economic recovery in U.S. history.” I guess I should thank your boy Jim for the civics lesson, Dick Durbin runs America, nothing I mentioned before matters! - Formerly Known As... - Wednesday, Jul 30, 14 @ 11:46 am: == And yet, as a percentage of GDP, federal taxes have never lower in my lifetime, or your lifetime. == Meanwhile, America has the second highest statutory corporate income tax in the world and the highest among industrialized nations. More reform and less loopholes are needed. http://www.investopedia.com/articles/investing/051614/do-us-high-corporate-tax-rates-hurt-americans.asp - so... - Wednesday, Jul 30, 14 @ 11:46 am: ==I’m with Bruce on inversion. Since corporations are individuals just like me, I’m changing my mailing address to Switzerland to get out of paying any U.S. taxes. Defend this inversion scam at your risk, Baron.== That’s not how inversion works. If Walgreens did invert, they’d still pay U.S. taxes on U.S. earnings. What inversion does it it allows Walgreens to get out of paying U.S. taxes on foreign earnings. The United States is pretty much the only major industrialized country that taxes worldwide income. Most other countries are on a territorial system. It’s a terrible competitive disadvantage. - Just Observing - Wednesday, Jul 30, 14 @ 11:47 am: === You can add my name to the long list of former Walgreen patrons who will no longer shop at Walgreens… === We’ll see if that actually pans out. I’m not saying you — @CapFaxFollower — but I’m doubting most Americans will vote with their wallets by not patronizing Walgreens. Even if Walgreens loses some customers, they will probably make it up and then some via this inversion. - Anonymous - Wednesday, Jul 30, 14 @ 11:54 am: From “Forbes”: –Despite all their griping about the U.S.’s highest-in-the-developed-world 35% federal corporate income tax rate, big profitable U.S. companies paid just 12.6% of their reported worldwide profits in federal income taxes in 2010, a study released today by Congress’ Government Accountability Office shows. – Some of you guys are just willing to take whatever they dish out. And you’re the same guys who gripe about a buck bump in the minimum wage. Unbelievable. http://www.forbes.com/sites/janetnovack/2013/07/01/gao-big-companies-paid-a-12-6-federal-income-tax-rate/ - Team Sleep - Wednesday, Jul 30, 14 @ 11:58 am: By the time our current Congress adjounrs, Dick Durbin will have been Senate Majority Whip for eight (8) years. In that time, plenty could have been done to not only restructure the personal income tax code but also the corporate tax code. This issue is symptomatic of D.C. shenanigans: platitudes and talking points rule the day. We have not changed the federal corporate tax rate in 28 years. That is unacceptable. The world economy changes daily and our D.C. leaders do nothing to tackle the problems facing the code and nothing to either discourage inversion or encourage investment. - Goonhammer - Wednesday, Jul 30, 14 @ 11:59 am: Btw, by becoming an S corporation you avoid paying federal and state taxes. Not sure which though. - Formerly Known As... - Wednesday, Jul 30, 14 @ 12:04 pm: Precinct Captain - lol, perhaps I should have specified the second sentence of that statement. My brain filtered the first one out. The first sentence is so much garbage that it blends in with the rest from the other 4 and does not even register. You know things are getting bad when your brain starts automatically filtering out the normal garbage, and gets so excited about seeing one speck of truth in a page of quotes, that it omits and negates the sentence immediately preceding it lol. Of course the economy is not Durbin’s fault. And of course this is not a serious reform or real answer to our economic woes. It’s just more politics of division and superficial “answers”. - Anonymous - Wednesday, Jul 30, 14 @ 12:04 pm: End of the world must be near. I agree with the Dick Durbin - Anon. - Wednesday, Jul 30, 14 @ 12:05 pm: ==Can any of you actually define what a tax inversion does?== I can, and Ben @ 11:20 is pretty accurate in his discription. It’s a method of keeping the US from taxing income that is actually earned outside the US by foreign subsidiaries. If it goes through with the inversion, Walgreens will still pay US income tax on its profits from business conducted by all the US subsidiaries in its corporate group, regardless of where that business is conducted, and on income earned in the US by foreign subsidiaries doing business here, exactly as it does now, but it won’t have to pay US income tax on the profits earned outside the US by its foreign subsidiaries. I really can’t get too worked up about avoiding US tax on foreign income. - Skeptic - Wednesday, Jul 30, 14 @ 12:05 pm: The Feds tax *my* foreign earnings, and since corporations are people too (remember?) why shouldn’t they get taxed just the same? Oh right, because corporations aren’t people in the right-wing-o-sphere. Except when they are. “With Freedom comes Responsibility.” - Jimmy - Wednesday, Jul 30, 14 @ 12:08 pm: TS - unfortunately, we are nation that does not value or want compromise from our elected officials. We have a system of government that works best (or at all) when politicians compromise. - Biker - Wednesday, Jul 30, 14 @ 12:22 pm: Not sure why Oberweis is lambasted for a legitimately economics based stance. I’ve been waiting 6 years for this administration to get serious about reducing the corporate tax rate. You can’t close loopholes without reducing the rate and expect not to create a great depression. - Black Ivy - Wednesday, Jul 30, 14 @ 12:28 pm: Does anyone believe U.S. Senator Dick Durbin’s attempts to bully Walgreens into remaining headquartered in Chicago is effective? Instead of these obnoxious tactics, the State’s Democratic leadership should perhaps focus efforts on granting lawful incentives to the corporation to maintain its presence here. The recent onslaught of anti-business, anti-wealthy noise coming from Democratic elected officials is really causing me great concern…and giving me heartburn! - Tim Snopes - Wednesday, Jul 30, 14 @ 12:37 pm: Rauner’s response sounds an awful like a recent column by Illinois Policy Institute’s Journalist in Residence, Scott Reeder. Maybe they share the same dorm room. - Tim Snopes - Wednesday, Jul 30, 14 @ 12:43 pm: Rauner should consider a hostile takeover of Walgreen’s, then gutting the company by closing unnecessary stores, laying off employees in the cosmetics and food departments and accepting only Medicaid patients. - ChrisB - Wednesday, Jul 30, 14 @ 12:46 pm: @so… –The United States is pretty much the only major industrialized country that taxes worldwide income.– Small correction. The US is the only major industrialized country who does this. Not pretty much. Corporations have a fiduciary duty to their shareholders first. Don’t like what they are doing? Buy some voting equity. Put some skin in the game. Then you can explain to the rest of the equity holders why you think the corporation should act irrationally and not reduce it’s tax liability as much as legally possible. Tell everyone why they should forgo sometimes Billions of dollars, you know, for the greater good. I’m not defending the practice, but it’s pretty obvious why it’s happening. It’s not just those “Greedy CEOs” who are behind the decisions, it’s the millions of shareholders who want to maximize their earnings that are behind the push. The hilarious part is the politicians created the mess now are whining about the effects. Durbin’s own working group (Simpson-Bowles) said to reduce both taxes and deductions, and he ignored it. Oberweis is exactly on point. - Raging Bull - Wednesday, Jul 30, 14 @ 12:49 pm: The US is the defender of the free world. We take that responsibility seriously. So too should Abbvie, Oberweis and Rauner. Shameful. - illinifan - Wednesday, Jul 30, 14 @ 1:08 pm: Glad I read the posts…Annonymous you posted what I was going to post about the effective tax rate being 12.6%….Corporations are supposed to make a profit, if whining about their taxes and getting the public to believe the whine will get an increased profit, they will do it. Remember the corporations own the media and all the other sources of information (including our legislature) to help “sell” their set of the “facts”. It is time for a legislators to cut past all the rhetoric and do some serious tax reform, including not allowing American businesses to off shore their money. - Dirty Red - Wednesday, Jul 30, 14 @ 1:11 pm: = Democratic Governors Association spokesman Rikeesha Phelon = Did I fall asleep at the switch or something? When did this happen? Congrats, Rikeesha! - Eve - Wednesday, Jul 30, 14 @ 1:11 pm: Rikeesha left Cullerton’s office for the DGA? I missed that! - Rich Miller - Wednesday, Jul 30, 14 @ 1:15 pm: RP is on a leave of absence. - Precinct Captain - Wednesday, Jul 30, 14 @ 1:16 pm: ==We have not changed the federal corporate tax rate in 28 years. That is unacceptable. The world economy changes daily== LOL. Should we be changing it daily or should we be celebrating that as “the world economy changes daily” coprorations can count on a stable American statutory tax rate. ==You can’t close loopholes without reducing the rate and expect not to create a great depression.== LOL. ==- Black Ivy - Wednesday, Jul 30, 14 @ 12:28 pm:== One incentive for them to remain might be no more federal dollars, which make up a quarter of their profit. ==- ChrisB - Wednesday, Jul 30, 14 @ 12:46 pm:== Fiduciary duty isn’t only short term. Alienate your business partners, customers, and employees and all your tax savings are eaten up by cratering revenues and profits. That doesn’t sound like a very good job doing your fiduciary duty to me. - Dirty Red - Wednesday, Jul 30, 14 @ 1:17 pm: = RP is on a leave of absence. = Thanks for the clarification. Eve, I call jinx. You owe me a Coke. - Skeptic - Wednesday, Jul 30, 14 @ 1:22 pm: “granting lawful incentives to the corporation to maintain its presence here” So we do that, miss out on our tax revenue and they move anyway. We’ve seen that time and time again. - fed up - Wednesday, Jul 30, 14 @ 1:26 pm: The problem here is everyones ignorance of what inversion is. The US tax code is poorly written and antiquated it puts US corporations at a disadvantage to those based overseas. Walgreens and other corporations would still pay US taxes on monies earned in the US. The real problem is that everyone President, Senate, and House all know the system needs to be changed but like everything else they cant agree on what to do. - mythoughtis - Wednesday, Jul 30, 14 @ 1:32 pm: ==Speaking for myself, if Walgreens goes, I won’t be going to Walgreens anymore and would strongly consider buying CVS stock, as I expect they would be a prime beneficiary of former Walgreens customers looking for alternatives. == CVS, Kmart, Target, Osco, etc, etc, etc. I rarely shop Walgreens. Their pharmacy department has outgrown their desire to provide quality customer service. It was THE place to go in the 1970s, but I can get better prices on the same store content just about anywhere now. I really have no desire to shop at companies that want to be all ‘red, white, and blue’ but hightail it out of the country to not pay taxes. I would Shop American products/companies even more if I could figure out where anything was actually made these days. - Robert the Bruce - Wednesday, Jul 30, 14 @ 1:38 pm: I’m usually against corporate welfare and I’m in favor of more taxes than the average person. But in reading about this, it seems that the U.S. really may be at a competitive disadvantage in this taxation of revenue earned in other countries. So, a U.S.-based manufacturer is taxed on goods it sells in the U.K. by both the U.K. and the U.S. But a U.K.-based manufacturer is taxed on goods it sells in the U.S. only by the U.S. So the U.S. has set up an incentive for countries to compete to poach U.S. firms, and those countries have done so. Reuters names U.K. and Ireland and the Netherlands as being some poachers: http://www.reuters.com/article/2014/07/24/us-deals-taxinversions-lawfirms-insight-idUSKBN0FT2PC20140724 - Jimbo - Wednesday, Jul 30, 14 @ 1:39 pm: Folks seem to think that these inversion schemes still allow the US to tax US earnings. That is technically true, however, companies like HP get around this by routing all supply through the foreign entity, then selling it to the US entity for an inflated price. The US entity makes nearly zero profits and pays no taxes after deductions, and all of the hefty profit is kept offshore. This, more than loopholes, is the reason most corporations pay zero taxes. - ChrisB - Wednesday, Jul 30, 14 @ 1:58 pm: @Precinct Captain You don’t think that was already in their calculations when they made the bid? That no one within the company did a worst case scenario analysis? They just did a straight NPV and called it a day? A quick Google search tells me that they paid a 37% tax rate in 2013. It is estimated that WAG will pay $4 Billion less in taxes over the next five years. You’re telling me that the cost of doing the inversion will outweigh that $4B in savings? Billion. With a B. That enough people will stop doing business with Walgreens, which have pretty much saturated the market, to justify staying in the US? - MOON - Wednesday, Jul 30, 14 @ 2:09 pm: Based upon the many comments against ” inversion ” because these people think it is Un-American then I wonder what they think about people/businesses who leave Illinois due to the high taxes. Are they also Un-American? - Jimmy - Wednesday, Jul 30, 14 @ 2:16 pm: Chris B “Corporations have a fiduciary duty to their shareholders first. Don’t like what they are doing? Buy some voting equity.” Corporations are a governmental creation. Why not just vote for candidates that will regulate them appropriately? seems like a more direct and better approach. - Jimbo - Wednesday, Jul 30, 14 @ 2:21 pm: MOON, that’s silly, but they are unIllinoisan. - Plutocrat03 - Wednesday, Jul 30, 14 @ 3:26 pm: Would PQ and DD be rendered mute if they were forced to stop their childish name calling? DD and associates created this goofy tax code. If there is something wrong, fix it. The fault lies in Washington. How many here pay more taxes than necessary. Thought so. Corporations pass their savings to their shareholders . Those funds are taxed at individual rates. That likely nets the Feds more revenue rather than less. - walker - Wednesday, Jul 30, 14 @ 3:40 pm: Read Jimbo 1:39 above. No matter what someone told you the tax code theoretically does, setting up these foreign HQ entities is often used to avoid substantial US taxes on US earnings. Again, to avoid US taxes on US earnings, in the real world. I’ve personally seen it done. You think these companies aren’t smart enough to structure their accounting and payments to accomplish that? - Anon. - Wednesday, Jul 30, 14 @ 4:30 pm: ==Folks seem to think that these inversion schemes still allow the US to tax US earnings. That is technically true, however, companies like HP get around this by routing all supply through the foreign entity, then selling it to the US entity for an inflated price. The US entity makes nearly zero profits and pays no taxes after deductions, and all of the hefty profit is kept offshore. This, more than loopholes, is the reason most corporations pay zero taxes.== As Jimbo points out, this particular dodge is not the result of an inversion. It is, however, the result of decades of incompetence at the IRS, whose record at enforcing IRC Section 482 to prevent this behavior would be a total failure except that litigating the cases is so bleeping expensive that the IRS has bludgeoned people into “advance pricing agreements” that do require them to pay something, just to gain some peace. - CapnCrunch - Wednesday, Jul 30, 14 @ 4:50 pm: “…. No matter what someone told you the tax code theoretically does, setting up these foreign HQ entities is often used to avoid substantial US taxes on US earnings…… You think these companies aren’t smart enough to structure their accounting and payments to accomplish that?” You guys are missing the point. Inversions are a way go getting access to the offshore pools of money that cannot be brought home because of our corporate tax rate. After inversion some of these funds can be brought home in the form of loans for Capitol expenditures, etc. The interest on the loan can be used to off set US profits but that is not the primary reason for the inversion. Corporations want access to this money. Congress can fix this problem by lowering the the corporate rate but policy makers refuse to deal with this single issue and insist that any tax law changes must be comprehensive. It’s that insistence on “comprehensive” bills that is preventing legislation on taxes and immigration. - Grandson of Man - Wednesday, Jul 30, 14 @ 5:06 pm: The thing that bothers me most about Walgreens’ possible corporate inversion is that the company is said to take in lots of money from our tax dollars though Medicare and Medicaid: 25% of its revenues. To want to leave after reaping so much benefit from us is not good optics from the company, and it opens the door to boycotts. AbbVie’s corporate inversion was reported to save the company about half of its corporate tax amount, from 22% to 13%. This corporation did not seem to be paying an exorbitant tax rate here in the US. I support the elimination of the inversion loophole and reform of the tax code. I thought Rauner supports closing some corporate loopholes, and if true, what’s with his “loss of freedom” talk? - CapnCrunch - Wednesday, Jul 30, 14 @ 5:28 pm: “I support the elimination of the inversion loophole and reform of the tax code.” Let’s reform the tax code to eliminate the incentive to use inversions. - Norseman - Wednesday, Jul 30, 14 @ 8:56 pm: This isn’t about competition. It’s about maximizing profit for shareholders and senior management regardless of the consequences. CVS is looking better every day. Sorry, comments for this post are now closed.