FT: Walgreens shareholders urge mgmt to relocate company to Europe for tax purposes

Discussion in 'Politics, Religion, Social Issues' started by ugahairydawgs, Apr 14, 2014.

  1. ugahairydawgs, Apr 14, 2014
    Last edited: Apr 14, 2014

    ugahairydawgs macrumors 68020

    ugahairydawgs

    Joined:
    Jun 10, 2010
    #1
    No idea if this has any possibility of happening, but it is an interesting topic all the same.

    What are opinions here on this potential move? What would the general consensus be on lowering the corporate tax rate to match the 20% rate referenced in Switzerland? At what point do our tax rates, compared to the rest of the world, compel businesses to leave as opposed to enticing them to stay?

    http://www.ft.com/intl/cms/s/0/55a76778-c294-11e3-9370-00144feabdc0.html#axzz2ytLjh4zF

    NOTE: Adding link to pretty much the same article but on CNBC instead. FT paywall is jumping up

    http://www.cnbc.com/id/101580301
     
  2. Eraserhead macrumors G4

    Eraserhead

    Joined:
    Nov 3, 2005
    Location:
    UK
    #2
    If you make the US corporate tax code sane then you can probably lower the rate.
     
  3. Ugg macrumors 68000

    Ugg

    Joined:
    Apr 7, 2003
    Location:
    Penryn
    #3
    I think what we need is for multinationals to pay taxes based on their country presence. If 20% of income comes from USA, then they need to pay taxes appropriate to the USA, etc, etc. also, no country should be able to claim corporate status if they do not pay taxes. And, if they have no presence in Switzerland or Bermuda or Ireland, then they cannot be incorporated there.
     
  4. ElectronGuru macrumors 65816

    Joined:
    Sep 5, 2013
    Location:
    Oregon, USA
    #4
    The Oregon / Washington boarder is an active place. The two states have roughly the same overall tax rate, but with two important differences. Oregon has a high income tax and no sales tax. Washington has a full sales tax and no income tax. Plenty of people see this difference and arrange their lives accordingly - living in Washington and shopping in Oregon.

    When these policies were written, communication was slow and transportation even slower. It didn't matter that different cities, states, and nations had odd or conflicting variations because there was little awareness of and no ability to take advantage. Everything has changed and our jurisdictions have not kept pace. Its now child's play to take advantage and we'll end up spending billions and untold energy rearranging the world with no actual productive benefit.
     
  5. G51989 macrumors 68030

    G51989

    Joined:
    Feb 25, 2012
    Location:
    NYC NY/Pittsburgh PA
    #5
    Fat chance of that ever happening, more large corporations perfer the complex loophole system, most of them ( not all ), pay well under 15%, and many of them pay nothing and get a refund.
     
  6. citizenzen macrumors 65816

    Joined:
    Mar 22, 2010
    #6
    Had to use the CNBC site for that reason.

    But here's what I pick up from that article ...

    For one thing you didn't describe your "shareholders" well in either your thread title or your OP. According to the CNBC article this pressure is coming from "an influential group of its shareholders" [read, wealthy].

    Who makes up this group?

    And what's in it for them?

    Are you really trying to defend this? This select group of wealthy investors don't care about America, or the jobs they would take away, or even the stated desires of the company.

    All they care about is fattening their wallets.

    And you think this has to do with the U.S. driving away business?
     
  7. sviato macrumors 68020

    sviato

    Joined:
    Oct 27, 2010
    Location:
    HR 9038 A
    #7
    Lowering rates may start a race to the bottom. As for the relocation, if the majority shareholders want it and the Board agrees then they can go ahead.
     
  8. ThisIsNotMe macrumors 68000

    Joined:
    Aug 11, 2008
    #8
    Why should Walgreens care about the United States?
    The peasants keep voting for the likes of Obama who insist on taxing them into oblivion to redistribute the wealth from the producers to the leech class.

    What, Walgreens should reward the American voter for screwing them?

    No!

    Walgreens should do everything in its power to not only better its position in the marketplace but the screw those who insist on screwing them.

    A corporation has one function, to generate profits for its shareholders. Nothing more.
     
  9. jnpy!$4g3cwk macrumors 65816

    jnpy!$4g3cwk

    Joined:
    Feb 11, 2010
    #9
    Why? Is this one of Newton's Laws? Maxwell's equations? Where does this "law" you have stated come from?
     
  10. citizenzen macrumors 65816

    Joined:
    Mar 22, 2010
    #10
    Walgreens is doing it wrong, eh?
     
  11. G51989 macrumors 68030

    G51989

    Joined:
    Feb 25, 2012
    Location:
    NYC NY/Pittsburgh PA
    #11
    Because that is where they do business, if they have an anti American vibe to their business, the American public will catch on and they will go bankrupt and out of business, and the shareholders lose everything.


    I voted for Obama, I run my own business, which is very successful and expanding quickly. I also make enough money to own a decent amount of property, have a nice big house, and a fleet of fun cars.

    I am a leech?

    What do you do for a living?

    Also, Taxes, Environmental regulations, and workers rights are MUCH tougher in Germany, which has a much stronger manufacturing environment than America...Germans produce more than Americans do...with only 60 million of them. Germany companies are HUGELY profitable with more regulations. Maybe Americans are just greedy and suck at business.

    Walgreens needs the American voter to stay in business. Without the American voters, they lose money, board up their stores, and go bankrupt and penny-less.

    Yes!

    So, they should better its position in the marketplace by telling the American voter to **** off like you just said? Its a good thing you don't own a business. You would fall flat on your face.

    This attitude is why America is not a good place to live for roughly half its its Citizens, and Western Europe is a much better place.

    ----------

    Nah, its just useless American logic.

    ----------

    They are only the biggest drug store/convince store in the US of A and brought in nearly 72 billion in sales last year, clearly they are failures.
     
  12. thekev macrumors 604

    thekev

    Joined:
    Aug 5, 2010
    #12
    I don't entirely understand your view here. Yes their purpose is generate profits for shareholders. What do rewards have to do with anything? Any net benefit outside of shareholder value is incidental.
     
  13. ThisIsNotMe macrumors 68000

    Joined:
    Aug 11, 2008
    #13
    The poster I was replying to indicated that Walgreens 'owes' something to America. No, it does not, especially when Americans vote for politicians who actively seek out to enact punitive levels of taxation.
     
  14. citizenzen macrumors 65816

    Joined:
    Mar 22, 2010
    #14
    Read my post a little more carefully.

    I said the select group of wealthy stockholders don't care about The U.S.A.

    I didn't say Walgreens owes America anything.
     
  15. jnpy!$4g3cwk macrumors 65816

    jnpy!$4g3cwk

    Joined:
    Feb 11, 2010
    #15
    All the more reason that the WTO should be working hard at normalizing corporate tax policy across participating countries. The lack of a uniform policy is what creates pressure for these illogical moves.
     
  16. ElectronGuru macrumors 65816

    Joined:
    Sep 5, 2013
    Location:
    Oregon, USA
    #16
    No, but it is a worthy question.

    Over the last century, other companies and citizens made investments in the US that have directly benefited Walgreens. Transportation infrastructure, drug research, protection from foreign invaders, product testing and safety, and most recently - subsidies to Walgreens customers for the purchase of Walgreens products.

    So now that it's Walgreens turn to participate in the cost side of that relationship, perhaps even support a system that would foster the development of future companies and shareholders, they should want to bail? And in such a way as they wouldn't also stop receiving those benefits?

    It's not a coincidence that the value gained by these shareholders is offset by the value lost by the public. Takers indeed.
     
  17. hallux macrumors 68020

    hallux

    Joined:
    Apr 25, 2012
    #17
    If they don't do business outside the US (a quick search shows the only "non-US" locations may be Guam and PR) then they shouldn't be allowed to have their corporate offices outside the US.
     
  18. Arran macrumors 68040

    Arran

    Joined:
    Mar 7, 2008
    Location:
    Atlanta, USA
    #18
    They're bluffing. Their stores will be too easy to boycott after the media blowback. And they know it.

    You don't panic and negotiate with people like these: You call their bluff.
     
  19. rdowns macrumors Penryn

    rdowns

    Joined:
    Jul 11, 2003
    #19
    I say let them go. Of course, I would also exclude them from fulfilling prescriptions for Medicare, Medicaid and veteran's prescriptions.
     
  20. Arran macrumors 68040

    Arran

    Joined:
    Mar 7, 2008
    Location:
    Atlanta, USA
    #20
    Absolutely. And that is why independent oversight and regulation is required.

    The jails are full of individuals whose one function was to get rich.
     
  21. ugahairydawgs, Apr 15, 2014
    Last edited: Apr 15, 2014

    ugahairydawgs thread starter macrumors 68020

    ugahairydawgs

    Joined:
    Jun 10, 2010
    #21
    Walgreens is not some philanthropic paragon of virtue. They are a for profit company whose sole goal, like any for profit company, is to make a profit. Moving their tax base to a much friendlier locale would be beneficial to shareholders for sure, but a decreased tax bill would also open up capital for pouring back into the business, which could mean more locations (i.e., more jobs) or better wages for current employees.

    My point was that if the US didn't have some of the highest corporate tax rates in the world these types of articles wouldn't pop up.

    ----------

    And Walgreens has funneled money back into the economy by creating jobs, purchasing inventory, real estate purchases, paying for utilities, and......most importantly......paying a boatload of taxes.

    Calling them moochers after the fact is a bit disingenuous, IMO.
     
  22. Huntn macrumors G5

    Huntn

    Joined:
    May 5, 2008
    Location:
    The Misty Mountains
    #22
    We've got to figure out a way to keep large profitable corporations from skating on their duty to support the system they operate in. Unfortunately I don't see "big business" Republicans supporting any such measure.
     
  23. citizenzen macrumors 65816

    Joined:
    Mar 22, 2010
    #23
    While the U.S. has one of the highest statutory tax rates, the GAO recently reported that the effective tax rate is far lower. Statutory rates indicate the tax liability before any exemptions, deferrals, tax credits, and other forms of incentives are taken into account.

    The U.S. statutory tax rate is 35%. The actual rate that corporations pay is far less than that.

     
  24. thekev macrumors 604

    thekev

    Joined:
    Aug 5, 2010
    #24
    There are a couple important points. One is that it needs to be difficult to circumvent, so that large companies are affected similarly in comparison to smaller companies that cannot afford the costs of some creative accounting methods. At that point it could be looked at more closely. As it is today their effective tax rates aren't always that high. If the tax laws continue to favor circumvention, it could continue to be problematic past a certain scale. What we have now punishes small businesses disproportionately in comparison to the largest ones, which is unfortunate.


    I get the context now, and I don't personify corporations. Describing it as a choice to reward was what I found odd. Figuring out how to maintain consistency would be the first part. Right now smaller businesses are hit disproportionately by these things with a small number of exceptions.
     
  25. ugahairydawgs thread starter macrumors 68020

    ugahairydawgs

    Joined:
    Jun 10, 2010
    #25
    And the necessity for it being so convoluted is purely political. Both sides use the tax code as a carrot for votes and its completely unnecessary.

    Simplify the system and get rid of all of these deductions and credits on the books and have a set (low) rate for everyone, companies and individuals alike.
     

Share This Page