Re-incorporating a company overseas in order to reduce the tax burden on income earned abroad. Corporate inversion as a strategy is used by companies that receive a significant portion of their income from foreign sources, since that income is taxed both abroad and in the country of incorporation. Companies undertaking this strategy are likely to select a country that has lower tax rates and less stringent corporate governance requirements
We came across this article in the “Wall Street Journal” regarding corporate inversion. It’s worth a quick read
“Endo to Buy Par Pharma for About $8 Billion”
By LIZ HOFFMAN
May 18, 2015
Endo International PLC agreed to buy rival drug maker Par Pharmaceutical Holdings Inc. for $8 billion, the latest in a string of cross-border mergers steering tax revenue away from the U.S., despite Washington’s efforts.
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