"As savvy investors and entrepreneurs search for ways to minimize the impact of the U.S. tax system, with its relatively high rates and global reach, they are increasingly incorporating overseas, tax experts say.
Some private-equity firms have relocated U.S. companies or divisions to tax-haven countries. U.S. multinational companies have spun off foreign subsidiaries in tax havens. U.S. start-ups are even beginning life offshore."
- The Wall Street Journal
June 24, 2011
The consequences of Obama's anti-business policies are coming "home to roost" as American corporations are beginning to incorporate outside of the United States.
Yesterday, I wrote about 8 specific anti-business actions that Obama has taken since becoming president. Following that story, a reader in Southern California suggested that I look into the story of Freescale Semiconductor and I discover yet another corner of the economy that Obama is destroying.
It turns out that Freescale is a long standing American corporation that went private in 2006 when a group of investors bought up all their stock. After a few years of restructuring and streamlining, Freestyle recently "went public" again.
Except this time they didn't do it as an American corporation, they did it as company that is headquartered in Bermuda, a tax haven.
On Friday, the Wall Street Journal wrote about this startling trend:
"It's certainly a growing trend, and managers and firms are getting smart about it," said Mihir Desai, a Harvard business professor. Mr. Desai calculated that in 2008, there were three U.S. initial public offerings of stock by tax-haven-incorporated companies for every 10 U.S.-incorporated IPOs. There has been no similar uptick in European markets."
Three out of ten, that's 30% of new businesses in America deciding to "take their ball and go away!" That means no corporate income taxes for treasury and no high paid corporate American jobs.
The WSJ also reported:
"If you're going to take a privatized company public, why wouldn't you say, 'What are the pluses and minuses of being incorporated in the U.S. versus somewhere else?' " said Willard Taylor, a tax lawyer with Sullivan & Cromwell LLP. "Very often, depending on what the business is, you'll conclude there are no pluses to being in the U.S."
All of this proves once again that Obama's never ending anti-business class warfare rhetoric is destroying the US economy. Perhaps worse is that he's lying to the American public when he says we can solve our deficit by raising taxes on corporations and the wealthy. To do so will simply chase them (and their capital) offshore and then they'll all be paying zero income taxes.
Just like Freescale!
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