Biotech Values

[DewDiligence]

US Treasury to toughen stance on tax inversions (but it can’t simply outlaw inversions without new legislation):

http://www.wsj.com/articles/treasury-department-plans-anti-inversion-tax-rules-this-week-1447883186

The U.S. Treasury Department will release new “targeted guidance” designed to reduce the tax benefits available to U.S. companies that move their tax address overseas.

Treasury Secretary Jacob J. Lew informed lawmakers of the coming announcement in a letter on Wednesday. The letter provides no details on what the Treasury Department will do, though the government has previously said it was examining “earnings stripping,” a practice by which companies load up their U.S. operations with deductions and effectively push profits to low-tax countries.

Later this week, we intend to issue additional targeted guidance to deter and reduce further the economic benefits of corporate inversions,” Mr. Lew wrote. “It is important to emphasize, however, that Treasury cannot stop inversions without new statutory authority. Unless and until Congress acts, creative accountants and lawyers will continue to find new ways for companies to move their tax residences overseas and avoid paying taxes here at home.”