Obama's screw the corporation tax structure chases another one away.

[Slyhunter]

In an unexpected and interesting move, Burger King is in talks to buy Canadian coffee-and-doughnut chain Tim Horton’s Inc., a merger that would be structured as a “tax inversion” which would effectively move Burger King’s headquarters to Canada

Tim Horton’s is no small coffee-shop chain. Tim Horton’s, Canada’s largest coffee-shop chain, has a market capitalization of about $8.4 billion, while Burger King’s market capitalization is about $9.6 billion; the proposed merger would form a new entity worth about $18 billion.

The really interesting part to the story however is not the pure fact that an American burger giant is buying up a Canadian national treasure (Wendy’s has previously owned Tim Horton’s for some time), but rather that Canadian corporate tax rates are favorable relative to American corporate tax rates enough to justify a “tax inversion”. A tax inversion occurs when an American company merges with a foreign one and, in the process, reincorporates abroad, effectively entering the foreign country’s tax domicile. An American company that merges with a Canadian target company for share consideration can avoid U.S. residency for tax purposes as long as the shareholders of the Canadian target end up owning at least 20% of the shares of the new parent immediately after the acquisition.

Canada’s corporate tax rate in Ontario of 26.5% (the federal rate of 15% plus Ontario’s provincial corporate tax rate of 11.5%) is considerably favorable to the American corporate tax rate of 35% thanks in large part to the conservative Canadian government led by Stephen Harper. The Harper government lowered the federal tax rate to 15% in 2012 down originally from 28% since it took office in 2006.

In fact, a recent KPMG Report, Focus on Tax, ranked Canada as the #1 country with the most business-friendly tax structure among developed countries when adding up a wide range of tax costs to businesses from statutory labor costs to harmonized sales tax. When comparing developed countries to what companies pay in the U.S.; Canada came in at 53.6%, the U.K. came in at 66.6%, and the Netherlands at 74.5% of the U.S. corporate tax burden.

Burger King s Tax Inversion and Canada s Favorable Corporate Tax Rates - Forbes

Additionally, drugs are cheaper in Canada. Allow us citizens to buy their drugs from Canada and bypass this screw America crap drug companies pull. The cure for Hepatitus C is $84,000 in America, $60,000 in Canada, and $500 in Syria. Though I wouldn't trust the Syria's version of FDA. And my sister needs it to live.

Anyhow we need a Conservative in the White House to bring Corporation money, like Apples several billion, back to America.

 

[C_Clayton_Jones]

Obama's screw the corporation tax structure chases another one away.

This fails as both a straw man and post hoc fallacy, well done.

 

[RetiredGySgt]

Obama's screw the corporation tax structure chases another one away.

This fails as both a straw man and post hoc fallacy, well done.

Sure it does cause you have provided evidence that Obama has not IN FACT been detrimental to our Businesses.

 

[boilermaker55]

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In an unexpected and interesting move, Burger King is in talks to buy Canadian coffee-and-doughnut chain Tim Horton’s Inc., a merger that would be structured as a “tax inversion” which would effectively move Burger King’s headquarters to Canada

Tim Horton’s is no small coffee-shop chain. Tim Horton’s, Canada’s largest coffee-shop chain, has a market capitalization of about $8.4 billion, while Burger King’s market capitalization is about $9.6 billion; the proposed merger would form a new entity worth about $18 billion.

The really interesting part to the story however is not the pure fact that an American burger giant is buying up a Canadian national treasure (Wendy’s has previously owned Tim Horton’s for some time), but rather that Canadian corporate tax rates are favorable relative to American corporate tax rates enough to justify a “tax inversion”. A tax inversion occurs when an American company merges with a foreign one and, in the process, reincorporates abroad, effectively entering the foreign country’s tax domicile. An American company that merges with a Canadian target company for share consideration can avoid U.S. residency for tax purposes as long as the shareholders of the Canadian target end up owning at least 20% of the shares of the new parent immediately after the acquisition.

Canada’s corporate tax rate in Ontario of 26.5% (the federal rate of 15% plus Ontario’s provincial corporate tax rate of 11.5%) is considerably favorable to the American corporate tax rate of 35% thanks in large part to the conservative Canadian government led by Stephen Harper. The Harper government lowered the federal tax rate to 15% in 2012 down originally from 28% since it took office in 2006.

In fact, a recent KPMG Report, Focus on Tax, ranked Canada as the #1 country with the most business-friendly tax structure among developed countries when adding up a wide range of tax costs to businesses from statutory labor costs to harmonized sales tax. When comparing developed countries to what companies pay in the U.S.; Canada came in at 53.6%, the U.K. came in at 66.6%, and the Netherlands at 74.5% of the U.S. corporate tax burden.

Burger King s Tax Inversion and Canada s Favorable Corporate Tax Rates - Forbes

Additionally, drugs are cheaper in Canada. Allow us citizens to buy their drugs from Canada and bypass this screw America crap drug companies pull. The cure for Hepatitus C is $84,000 in America, $60,000 in Canada, and $500 in Syria. Though I wouldn't trust the Syria's version of FDA. And my sister needs it to live.

Anyhow we need a Conservative in the White House to bring Corporation money, like Apples several billion, back to America.