Politicians slam Pfizer-Allergan deal as tax dodge

November 24, 2015 07:25
Ian Read, chairman and chief executive of Pfizer (left), and Brent Saunders, president and chief executive of Allergan Plc have announced a US$160 billion merger of their companies. Photo: Bloomberg

US politicians condemned Pfizer Inc.'s deal with Allergan Plc as a tax dodge, Reuters reported.

Democrats heaped the most criticism on the New York-based drug maker Monday, Hillary Clinton accusing Pfizer of using legal loopholes to avoid its "fair share" of taxes in a deal that she said "will leave US taxpayers holding the bag".

The front-runner for the Democratic presidential nomination said she will propose steps to prevent more inversions -- where a firm shifts its tax domicile abroad -- but she did not provide details.

"We cannot delay in cracking down on inversions that erode our tax base," she said.

Republican front-runner Donald Trump, who has called for a corporate tax overhaul, called the deal "disgusting" in comments to news website Business Insider.

Pfizer is doing the largest inversion deal of all time.

In a US$160 billion transaction, it plans to move its tax address from the United States to Ireland, if only on paper, by buying and merging into Allergan, a smaller, Dublin-based competitor.

The combined company will be called Pfizer and will be run by Pfizer's chief executive, with top management staying in New York and extensive operations across the US, but it will no longer be taxed as a US company.

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