Friday, May 2, 2014
The Financial Times Provides A Lesson On Corporate Tax Avoidance
Pfizer's recent bid to acquire AstecZeneca an reincorporate in the UK is predicated on avoiding the US corporate income tax. Ireland has been the most popular location for multinational corporations. This article provides a primer on the use of tax havens by MNC's. It also discusses some of the responses to these tax avoidance schemes that are being debated. Politicians in both parties would like to do something to curtail this practice but they have not been able to agree on the best strategy. The OECD has also been involved in similar discussions about MNC tax avoidance schemes. The MNC's are likely to find ways around the roadblocks that nation states produce to limit tax avoidance. They will do what is in their best interest. Nation states have a hard time reaching agreement on the national interest.