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Inversions to Continue Until Broad Tax Reform Achieved

Washington – Business Roundtable President John Engler issued the following statement today regarding the Pfizer-Allergan merger announcement:

“Pfizer’s merger deal is the latest, but not the last, effort by a U.S.-headquartered company to use a self-help solution to compete in the global marketplace. America’s outdated tax system is once again pushing U.S. headquarters through the exit door.

“Business Roundtable agrees with Congress and the Administration that comprehensive business tax reform is the only way to stop companies from moving their headquarters to foreign countries via ‘inversion.’ In addition, ‘inversions’ are not the only symptom of our outdated tax system: Acquisitions of U.S. assets by foreign companies remain at an all-time record level. Piecemeal regulatory and legislative fixes do not solve the problem. Temporary approaches fail to address the systemic anti-competitive nature of the U.S. tax system.

“A reformed tax code – which includes modern international tax rules and a corporate rate of 25 percent or lower – can make America a winner in the global marketplace. We remain confident that these reforms can be made in a bipartisan and fiscally responsible manner. Clearly, changes of this magnitude will require compromise and careful consideration of how we transition to a newer, more competitive system.

“Business Roundtable strongly urges policymakers to pass business tax reform legislation in the near term to encourage job creation and investment in the United States.”

Learn more about Business Roundtable positions on tax and fiscal policy here and the 2015 growth agenda here.
 

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