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  • scotchman9 scotchman9 Aug 22, 2010 6:13 PM Flag

    tax cheat

    It is common knowledge that American corporations avoid taxes by running U.S. profits through offshore "tax havens" like the Cayman Islands and Bermuda, but a May Bloomberg Business Week investigation traced the specific steps that the pharmaceutical company Forest Labs takes to short the U.S. Treasury. Although Forest's anti-depressant Lexapro is sold only in the U.S., the company's patent is held by an Irish subsidiary (and since 2005, shared with a Bermuda subsidiary in a tax-code hocus-pocus that insiders call the "Double Irish"), which allows the vast majority of the $2 billion Forest earns a year on Lexapro to be taxed at Ireland's low rate (and at Bermuda's rate of zero)

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    • There's nothing remotely "cheating" about any of Forest's tax practices. Get an understanding of our tax laws (you know, the ones that the geniuses in Congress have passed over the years), in particular transfer pricing and the international tax rules, before you throw around terms like that. The IRS has disagreed with Forest's transfer pricing practices in years past to some degree, but for the most part has basically signed off. They are just well structured at this point.

    • Maybe our know-nothing Congress could take lessons from the low tax countries while they are junketing around the world. Could increase U.S. employment if they were smart.

 
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