Obama Stops Pfizer Merger That Is All About Dodging Taxes

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My family holds a lot of Pfizer stocks because my father-in-law was one of the key scientists who invented a number of products since WWII which were highly successful.  He won awards over his long life doing this and was very good at doing this.  Now, Pfizer, anxious to avoid paying taxes, is playing the usual international games seeking various tax havens to merge with smaller companies so they could pretend to move their headquarters to small islands, etc.  The Obama administration just put an end to this and I expect Pfizer stocks to fall this morning since betting on a tax haven game will no longer be a fine thing for rich people to play.

 

$160B Pfizer-Allergan deal dead, numerous reports say

 

Analysts said the unexpectedly aggressive tax law changes issued late Monday, and their timing, were aimed squarely at preventing New York-based Pfizer, the biggest U.S.-based drug maker from completing its proposed $160 billion Allergan acquisition and inversion in the second half of the year.

 

“The Obama administration isn’t just sending a message to Pfizer, it’s sending a message to all U.S. companies contemplating inversions, and that message is ‘Don’t,”‘ said analyst Steve Brozak, president of WBB Securities LLC.

 

This has been going on a long, long time.  I said way back in the 1980’s that allowing major corporations to dodge taxes this way is suicidal.  But Reagan ruled and we got free trade with Bush Sr. and then Clinton ran against this only to do it, too, and then got many millions in bribes when he retired and here we are: Obama actually is now stopping this?  I am amazed.  Very amazed.

 

Obama touts new federal rules that target corporate tax inversions – CBS News

 

In an inversion, a big company buys a smaller one in another country, usually with a lower tax rate, then moves the combined company’s address on paper – but little else – to that country. Allergan itself is the result of multiple inversions and, despite its Dublin address, is operated from offices in Parsippany, New Jersey.

 

There is little ‘big news’ in the US about the Panama trove of data, there are stories like this at the Washington Post, Scrutiny on officials worldwide increases in offshore leaks, but the NYT has chosen to make this a low priority story for some oddball reason.  HAHAHA.

 

The president of Iceland which is an offshore haven for tax evaders which has gone bankrupt due to stupid spending, saw Gunnlaughsson resign in disgrace.  Now, it is London’s turn.  Panama Papers: Downing Street says ‘no offshore trusts’ will benefit Camerons in future – live updates | Politics | The Guardian

 

It has been a bit like pulling teeth, but finally we are getting some clarity about the prime minister’s finances.

 

David Cameron’s father Ian, who died in 2010, was a wealthy stockbroker. We knew some years ago that he ran an offshore investment fund, Blairmore Holdings, but new information about it emerged in the Panama Papers. When Cameron senior died, he left £2.74m in his will. The carefully-worded statements issued yesterday about Cameron, his wife and children were in the present tense. They left open the possibility that there could be money in an offshore trust fund from which Cameron, or more probably his children, might benefit in the future. This morning’s statement appears to quash that notion.

 

At least, it does if we assume that Blairmore Holdings is still defined as “offshore”. The Telegraph reports today that it moved to Ireland in 2010. Whether Ireland counts as offshore may be a moot point.

 

At no point has Cameron or Number 10 discussed whether his mother Mary continues to benefit from Blairmore, or another offshore fund.

 

And Cameron has not tried to address another aspect of the question put to him by Sky yesterday, namely whether he and his family benefited from his father’s offshore fund “in the past”. The reason for that omission is fairly obvious. Cameron enjoyed a privileged upbringing and an expensive education and, like many people, continued to receive money from his parents after leaving school. (He received £300,000 from his father in his will; it would remarkable if there was not other financial support too, while his father was alive.) We will probably never know what proportion of Cameron senior’s money came from conventional onshore earnings, and what proportion came from Blairmore, but it is probably safe to assume some of the Blairmore revenue did not help fund Cameron’s upbringing.

 

The City of London is like an offshore tax haven.  The huge towers built there are there because it is separate from England and has different laws and can operate as an alien business.  About the City – City of London

 

The City Corporation is older than Parliament and our experience and tradition underpin our modern role as the provider of key services. Elected Members, headed by the Lord Mayor, operate on a non-party political basis.

 

The City Corporation plays a key role in sustaining London’s lead in international business and finance. This work ranges from the Lord Mayor’s role as an international trade ambassador to the Policy Chairman’s role setting the strategic direction of the organisation. We welcome foreign dignitaries and heads of state on behalf of government and represent the interests of business to Westminster, Whitehall and Brussels. This is to reinforce the importance of finance and business services to the UK economy and London’s status at its centre.

 

Saudi Arabia unveils AUSTERITY plans as the nation prepares for tumbling oil prices:  Saudi royals are deep in doo because of the Panama leaks.  They just announced they are going to cut social services and other things due to having no money and this will definitely lead to the elimination of the Saudi royals as heavily armed gangs attack them and kill them off.  The CIA and the City of London don’t want this to happen, of course.

 

But stopping the inevitable is difficult.  History is a bloody bitch and difficult to stop.  The problem of our rulers and elites moving wealth into places where their own people can’t tax it is obvious: it causes countries to GO BANKRUPT and society to collapse!  Duh!  How stupid is this?

 

It is dumb, of course.  It is why we have history stories of bloody uprisings, etc.  Doing smart things to make one’s country richer and more humane has a wonderful pay-off whereas looting it has a terrible downside.  But of course, greedy people don’t want to see this, they just want to hog things for themselves and tell everyone else to eat cake.

 

sunset borger

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2 Comments

Filed under .money matters

2 responses to “Obama Stops Pfizer Merger That Is All About Dodging Taxes

  1. John S

    “Blairmore Holdings”? Maybe, “Blair! More Holdings!” is more like it.

  2. Jim R

    Too little, too late.

    It’s impossible to really describe how little/late it is. By preventing this merger, he is taking one bailing scoop of water out of the ocean, pouring it on the beach, and announcing that he has stopped the tide from coming in.

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