Investing Blog

Finance Blogs » Investing » The King may defect to Canada

The King may defect to Canada

By Sheyna Steiner · Bankrate.com
Monday, August 25, 2014
Posted: 3 pm ET

2014 is shaping up to be the year of the tax inversion. That thing that you never heard of before is now the talk of the nation. Companies are lining up to escape the tax burden imposed by the U.S. The most recently rumored defection: Burger King is in talks to acquire the chain of Canadian coffee and doughnut emporiums, Tim Hortons, the Wall Street Journal reported on Sunday.

"The purpose behind the considered Horton -- Burger King inversion would be to relocate the country of incorporation for Burger King from the United States to Canada," says attorney Matthew Reischer, CEO of LegalAdvice.com.© Alberto Stocco/Shutterstock.com

"U.S. multinationals argue that they are merely fulfilling their fiduciary duty to maximize shareholders' profits through an inversion strategy while many policy makers, pundits and politicians worry that such strategies, while legal, undermine a rich tax base for the U.S. government," he says.

According to a recent Bloomberg article, "Tax inversion: How U.S. companies buy tax breaks," about 41 American companies have skipped to low-tax countries since 1982. Twelve of those tax inversions occurred after 2012 and 8 companies plan to pull the switcheroo this year.

Tax inversions: unpatriotic move or is it just business as usual?

Get more Investing News with our free weekly newsletter.

Follow me on Twitter @SheynaSteiner.

***
Senior investing reporter Sheyna Steiner is a co-author of "Future Millionaires' Guidebook," an e-book written by Bankrate editors and reporters. It's available at all the major e-book retailers.

«
»
Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
1 Comment
Add a comment

(Comments may take 5-10 minutes to appear)