Large American companies are shifting their legal addresses overseas to escape the U.S. tax system at the fastest pace in a decade. In the first half of 2014, the list of firms that considered or carried out such plans, known as "inversions," included Pfizer Inc., Walgreen Co., and Medtronic Inc. By one estimate, these moves may cost the U.S. Treasury $19.5 billion in foregone revenue over the next 10 years. Articles in this series highlight the failure of lawmakers to stanch the flow, and how companies that renounce their U.S. tax addresses continue to reap the benefits of being American.
President Obama and legislators are embroiled in a debate over whether and how to punish companies that seek U.S. tax relief by buying a smaller foreign company and legally reincorporating in its country.
American manufacturer Ingersoll-Rand forged the tools that carved the Panama Canal and shaped Mount Rushmore. When it shifted its legal address to Bermuda in 2001 to reduce taxes, the maneuver sparked bipartisan outrage in Congress.