As many political pundits say “What the American people need to know…” This is followed by whatever they believe the American people need to know or what they want the American people to believe. Today I read a news article in USA Today about Walgreens. I for one did not realize that Walgreens is the largest pharmaceutical chain the United States. The article explains that the Walgreens chain started in Dixon, Illinois. The company which now has 8,500 stores across the United States is making a decision about whether it should save billions of tax dollars by using a tax loophole called an inversion.
According to this article, the inversion loophole allows any company conducting its primary business in the United States to bypass major taxes by merging with or buying into another company located in a country with a lower tax base. Walgreens may be buying controlling stock in Alliance Boots, commonly known throughout the UK as Boots UK, a pharmacy and more. Even I have shopped there when in England, but had no idea that this was a Swiss owned company. Additionally, it seems strange to me that the Swiss would have a lower tax rate than the United States.
The article discusses the fact that people in Dixon, Illinois are more than upset about this potential move, but this addresses a larger issue. With so much political discussion about “Made in America”, bringing jobs home to the United States, and creating jobs, the unruly power of corporations allows them to manipulate all of these concepts by moving out of the United States further depleting the tax base.
Why isn’t somebody petitioning Congress to close this loophole? According to the article this year alone multiple companies are planning their moves for the same reason. All this, while Americans who live abroad are being monitored and harassed over every bank account that they hold in a foreign country, while these corporations are getting away with billions of dollars.
The story is here.