Senators urge Burger King to ditch move to Canada 

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A group of U.S. senators wants Burger King Worldwide (BKW.N) to scrap its plans to invert, or move its tax domicile to Canada, as part of a deal to buy coffee and donut chain Tim Hortons Inc. (THI.TO)

Burger King announced in August plans to buy the Canadian restaurant chain for $11.5 billion. Canada has a lower corporate tax rate than the United States, and it does not require companies based there to pay extra taxes on income earned abroad, so the deal was expected to yield tax savings.

“Now, after profiting from these taxpayer-funded benefits, Burger King intends to move its tax address overseas to avoid paying its fair share for these benefits,” the group said in the letter, which was viewed by Reuters.

“Many of your loyal customers may choose to spend their hard-earned money at one of your many competitors, instead of supporting a company that wants all the benefits of America but refuses to pay its fair share to support our nation,” they said.

At least nine U.S. companies are in the final stages of inversions, which involve buying a competitor in a lower-tax country and basing the combined business there.

Drug store chain Walgreen Co which is based in Durbin’s state of Illinois, considered inverting as part of its purchase of European retailer Alliance Boots Holdings. After Durbin and others slammed the move, Walgreen said last month that it would not move overseas after all.

Source: Reuters

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