Food firms aim to sew up move to cut tax bill
Print Edition
BURGER King is in talks to buy donut chain Tim Hortons and create a new holding company headquartered in Canada, a move that could shave its tax bill.
Such an overseas shift, called a tax inversion, has become increasingly popular among US companies and a hot political issue. Burger King was founded in 1954 with a single restaurant in Miami, where it is currently based.
In a tax inversion, a US company reorganizes in a country with a lower tax rate by acquiring or merging with a company there. Inversions also allow companies to transfer money earned overseas to the parent company without paying additional US taxes. That money can be used to reinvest in the business or to fund dividends and buybacks, among other things.
Companies like AbbVie, a pharmaceutical with its headquarters just outside Chicago, have tied up with companies overseas to achieve that type of tax cut. More recently, Walgreen backed away from such a plan under intense pressure and criticism at home.
Burger King and Ontario-based Tim Hortons have cautioned that there was no guarantee a deal would happen, and it’s not clear exactly how much a tie-up would reduce Burger King’s tax costs. But a recent report by KPMG found that total tax costs in Canada are 46.4 percent lower than in the United States.
Burger King said its majority owner, investment firm 3G Capital, would own the majority of shares of the new company if a deal were to happen.
Burger King and Tim Hortons say the deal would also allow the donut chain to accelerate its growth in international markets.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
