Pfizer’s Tax Inversion
Pfizer did something very few have been able to accomplish – they got Hillary Clinton and Donald Trump to express similar opinions. However, they are both wrong.
Pfizer’s recent merger with Allergan and the move of its corporate headquarters to Ireland with the larger Pfizer merging into the smaller Allergan is known as a tax inversion. Substantial U.S. taxes will be saved with this maneuver. Nothing illegal was done and applicable provisions of the U. S. Tax Code have been complied with. I believe it is the responsibility of publicly owned corporations to do what they could legally do to reduce their taxes.
I have no comment about the specific tax actions Pfizer is taking but I am upset that these two leading candidates and others that voiced dismay along with demands that Pfizer not do it and pay more taxes than they should. I believe it is unpatriotic to try to force or cajole businesses to pay more tax than the law permits.
Our tax code is convoluted and has many things in it that are not fair and somewhat confiscatory that informed taxpayers try to avoid. There are also many loopholes smart taxpayers try to take advantage of. Congress enacted and the President signed into law every one of the provisions of the tax code. We have a terrible tax code but in spite of that our system seems to work quite well. Prominent public figures that assert these sort of negative comments do not add to the climate of voluntary compliance.
I also believe that those uttering the negative comments do not have any concept of how complicated and convoluted the tax laws are. A basic test for this is that they do not prepare their own tax returns; the reason being is that their returns are too complicated, they are not trained in taxes and that they feel that by doing it themselves they might miss a loophole or a benefit they are entitled to!
Let Pfizer have their benefits and if the complainers can, let them work, if they become able to, to make the tax code fairer and more equitable and less complicated.
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