The CEO of Walgreen’s has announced that, suddenly, Walgreen’s is no longer an American company, but is Swiss. That means that they will no longer pay taxes to the US government. But that won’t stop them from keeping all of their stores in the US, and it won’t stop them from taking money from the federal government when it comes to Medicare payments.
It will mean, though, that they can no longer lobby the US government, if they’re a foreign company.
Looking at the article, it sounds like they may actually be merging with a Swiss company. That’s a lot different than just deciding “Fuck America, we’re heading to Europe.”
Great. Now their cashiers will be pushing *Swiss *chocolate.
It’s not a merger, it’s a takeover.
and I question the idea that a company based in Europe can really evade the bulk of US taxes. I’m sure there are tax savings, but I would be skeptical of “they will no longer pay US taxes” claim. I tried to follow the link to that allegation in the article but it didn’t work.
You say that like it’s a bad thing.
Nescafe will be on sale too.
So which country gets CVS? Italy, France or Germany?
They’ll still have to collect sales tax at the register, right? Must be some other “corporate” taxes that are the concern, I guess…
Great. 
It will be full of holes, now.
The CEO of Alliance Boots was asked for comment, but chose to remain neutral on the subject.
It’ll be the go-to place for army knives.
There’s a lot ignorance to be fought in that statement.
Even foreign companies must pay U.S. corporate income taxes on profits generated in the U.S. Don’t always believe the whoo that you see on the internet.
Does that mean we’ll be able to get cheaper European version of drugs at their pharmacies?
This is becoming trendy as of late. Minnesota based biomedical giant Medtronic just did this by buying out Covidien and moving headquarters to Ireland. Pfizer tried (but failed) to do this by aquiring AstraZeneca. The gist is that these US based companies that are doing buisness globally have to pay large US taxes on profits made overseas to get the money back into the US. They can bypass this by being headquartered in countries with lower corporate taxes.
From the Forbes article: To protect the company from disinvestment and the shareowners from price deterioration, the company’s best option for maintaining growth has been to harvest offshore profits by domiciling in another country where taxes are lower than in the U.S, an increasingly popular trend known as tax inversion.
Wow, you’re stupid. And the article to which you linked is even more stupid.
Corporations headquartered in foreign countries continue to pay taxes to the United States on income they earn in the United States. The difference is that they no longer pay taxes to the United States on income earned in foreign countries. And why the fuck should they?
For that matter, why should an American-headquartered corporation pay US taxes on money earned overseas? They already pay taxes on such income to foreign countries. Twenty-eight out of the 34 OECD countries, including such bastions of right-wing nutbaggery as France, Sweden, and the Netherlands, do not assess domestic taxes on foreign profit.
The US, along with five other OECD countries (of which the only one of any economic consequence is South Korea), persists in our asinine and complicated system of worldwide taxation. Then liberals whine when multinations domicile elsewhere. I hope every multinational domiciles overseas; then maybe we’ll get with the rest of the world on corporate taxation.
Right, this will have minimal impact on corporate tax revenue in the United States because they will continue to pay corporate taxes on income earned in the United States–which I’m sure is the vast majority of Walgreen’s income.
But now, any international income that Walgreens generates can be moved around within the corporate coffers and not be heavily taxed once it’s back in the coffers of the corporate home country. Most companies are so ill served by bringing overseas income back to the United States that they leave tens of billions (look at Apple, Google, Microsoft etc who all do this) in overseas accounts because they’d rather keep that money overseas to just use as capital for their international operations versus pay the U.S. “worldwide” income tax on the money.
It’s one reason worldwide corporate income taxation is such a dumb policy (and as has been mentioned, the United States is almost alone in doing this), because it really produces not that much revenue because facing the prospect of what will often be true double taxation (in that they’re paying corporate income tax both in the country of business and their home country) most companies aren’t bringing that overseas money back to the United States–so we generate little revenue. But we lose out on the benefits of that capital being back in the United States where it may be invested stateside.
Right now it makes sense for many companies to leave capital basically “asleep” even if they have capital spending they’d like to engage in at home, because they’d rather not pay the taxes.
Actually even aside from the worldwide taxation nonsense, the United States has a corporate tax code in general that makes us among the least competitive countries in the world in terms of where to headquarter an international business. Contrast this with the U.K. whose corporate tax policies essentially amount to putting up a sign saying “We’re Open for Business!” and it’s no wonder many American companies have reheadquartered in London.
Nutella for everyone!!!
The biggest difference is instead of saying “help check” over the PA they will have to yodel it.
I, for one, think it will be enchanting.
You don’t really understand how the US tax system works, do you? :rolleyes:
Yes, they will pay US taxes on US income just like thousands of international companies do today.