Tax Inversion: BK to Acquire Tim Horton’s

2014 August 26
by bc3b

Burger King is acquiring Canadian-based Tim Horton’s for $11 billion to reduce its tax liability from 40% (U.S.) to 26% (Canadian) and Warren Buffet’s Berkshire is financing the deal.

There’s nothing wrong with trying to pay as little as possible in taxes, but it’s interesting that Democratic supporter and Barack Obama buddy Warren Buffet’s company is financing the deal while Obama is whining about tax inversion (U.S.-based companies fleeing the United States to reduce their tax burden).

We all know Buffet is a world-class hypocrite, complaining about not paying enough taxes while one of his subsidiaries owes more than $1 billion in back taxes. Plus, thereis a provision in the tax code where Buffet can contribute more than he personally owes in taxes – one he has not opted to use.

Burger King on Tuesday confirmed plans to acquire Ontario-based Tim Hortons for about $11 billion—creating a new company to be based in Canada with combined sales of $23 billion.

Berkshire Hathaway Chairman and CEO Warren Buffett is helping to fund the deal by committing $3 billion of preferred equity financing. The news release on the deal did not disclose the terms for Berkshire, which is only a financing source and will not have any participation in the management and operation of the business.

For those of you not familiar with Tim Horton’s it is a restaurant chain started by a NHL hockey player who has been dead for 40 years. It began as a donut shop and has expanded its offerings to include soups and breakfast sandwiches similar to McDonald’s, BK and Dunkin’ Donuts. There are hundreds of Tim Horton’s across Canada and northern border states like Michigan and New York.

Burger King’s move to acquire the Canadian restaurant chain Tim Hortonswould give the U.S. fast food giant a major presence north of the border.

It would also save the company a whopper of a tax bill.

The deal would be the latest in a once-obscure tax dodge known as a corporate “inversion” that is turning the debate over U.S. tax reform upside down.

As the pace of these deals picks up, the White House is scrambling to find a way to close this corporate tax loophole, which the Treasury estimates could eventually take a $20 billion bite out of corporate tax receipts. But unless, and until, Congress gets down to a long-overdue overhaul of the tax code, companies like Burger King with big overseas profits will likely continue to pursue these deals.

Hat tip: CNBC via the DrudgeReport

It’s a win for everyone except the U.S. Treasury.

32 Responses leave one →
  1. 2014 August 26 8:34 am
    [1]
    drdog09 permalink

    Its the battle between capital flight and capital capture. Flight is winning. Nor do I expect to see Congress move on this. To `Win` Congress would have to lower the corporate tax rate to something more akin to what folks in Russia, Australia, Singapore and Taiwan pay — 13-19% corp rate. We all know that the Dims in Congress would not allow that to happen. So the flight will continue.

    If the GOPers had the b@#$ they would do a flat tax revision. It kills the capital flight problem and also kills the IRS in one act.

  2. 2014 August 26 9:46 am
    [2]

    Socialist actions have capitalist consequences.

  3. 2014 August 26 9:57 am
    [3]
    bc3b permalink

    drdog09 –

    Either a flat sales tax or national sales tax IN PLACE OF the federal income tax should do the trick. The thing I like about a national sales tax is that $300 Air Jordans get taxed.

  4. 2014 August 26 10:21 am
    [4]
    justrand permalink

    if it wasn’t for HYPOCRISY the Dems/Left (mostly same folks) wouldn’t have any credo at all!

    ok…they’d still have DECEIT and PERVERSION…but it would take something they treasure away from ’em! 🙂

  5. 2014 August 26 10:32 am
    [5]

    #1 – Yup, once again congress dithers while the world adapts around them and moves on, and real unemployment continues at painful levels. Makes you want to run out and re-elect your congressman and senator doesn’t it?

    So where’s the wave?
    http://www.politico.com/magazine/story/2014/08/reading-the-2014-tea-leaves-110325.html

    It’s fizzling, just like anyone with clue could see many months ago, for it to exist the “party” would have to actually stand for something voters actually care about and at least act like their going to take action on, it doesn’t. Good luck in November GOP, you’ll need it.

    http://www.breitbart.com/Big-Government/2014/08/26/Jerry-Brown-to-Mexican-Illegals-You-re-All-Welcome-in-CA
    “According to the Los Angeles Times, while introducing Mexican President Enrique Peña Nieto, who said America is “the other Mexico,” Brown “spoke about the interwoven histories of Mexico and California.” He “nodded to the immigrants in the room, saying it didn’t matter if they had permission to be in the United States.”

    “You’re all welcome in California,” Brown reportedly said. ”

    Well isn’t that special.

  6. 2014 August 26 10:40 am
    [6]

    Also of note…

    Think most of what the NSA finds stays with the NSA for their own “national security” purposes? Think again.

    The Surveillance Engine: How the NSA Built Its Own Secret Google
    https://firstlook.org/theintercept/article/2014/08/25/icreach-nsa-cia-secret-google-crisscross-proton/

    “The National Security Agency is secretly providing data to nearly two dozen U.S. government agencies with a “Google-like” search engine built to share more than 850 billion records about phone calls, emails, cellphone locations, and internet chats, according to classified documents obtained by The Intercept.

    The documents provide the first definitive evidence that the NSA has for years made massive amounts of surveillance data directly accessible to domestic law enforcement agencies. Planning documents for ICREACH, as the search engine is called, cite the Federal Bureau of Investigation and the Drug Enforcement Administration as key participants.

    ICREACH contains information on the private communications of foreigners and, it appears, millions of records on American citizens who have not been accused of any wrongdoing. Details about its existence are contained in the archive of materials provided to The Intercept by NSA whistleblower Edward Snowden.”

  7. 2014 August 26 10:48 am
    [7]
    bc3b permalink

    KH –

    There’s nothing wrong with the U.S. adopting Mexico’s immigration laws (since we are so intertwined and all).

  8. 2014 August 26 10:52 am
    [8]
    drdog09 permalink

    “…for it to exist the “party” would have to actually stand for something voters actually care about…”

    No truer words have been spoken. Voter apathy is so high that if there was a third option `none of the above` we would have to call a special national election as there would be no representatives in the House to call a quorum. And at this point that sounds like a good thing.

  9. 2014 August 26 10:55 am
    [9]
    drdog09 permalink

    7,

    Wish it would happen. IP could get in the cockpit again. All the American air carriers would be flushing all mexican nationals out of their work force. (No foreigner can work for AeroMexico per mexican law.)

  10. 2014 August 26 10:57 am
    [10]
    drdog09 permalink

    BC, I would be in favor of a national sales tax in lieu of form 1040. What I don’t spend stays in my back pocket.

  11. 2014 August 26 11:03 am
    [11]

    7 – Only we (congress) will not adopt such sensible laws.

  12. 2014 August 26 11:05 am
    [12]

    10 – My preference as well (nst\fairtax type), but even the flat route would be at least a slight improvement.

  13. 2014 August 26 11:15 am
    [13]
    JustMary permalink

    “You’re all welcome in California,” Brown reportedly said.

    Bring your own water.

  14. 2014 August 26 11:16 am
    [14]
    JustMary permalink

    #10 And because looters tend to spend every last dime they are handed from the public dole, that money would go right back to where it came from.

  15. 2014 August 26 11:17 am
    [15]

  16. 2014 August 26 11:21 am
    [16]
    JustMary permalink

    #15 How long before ISIS does damage here? It does concern me that September 11th is right around the corner. 🙁

  17. 2014 August 26 11:24 am
    [17]
    Wylie E. Coyote permalink

    “My favorite filmmaker, Colin Gunn, is about to release Wait Till It’s Free, his new documentary on Obummercare. I’ve seen a preview, and the movie is up to Mr. Gunn’s usual sky-high standards. Among other highlights, a certain doctor who dabbles in politics offers his assessment of socialized medicine; the heroic Jane Orient also damns this monstrosity.

    Mr. Gunn interviews folks who suffer under Britain’s NHS about their experiences as well as victims of the Veterans’ Administration to draw parallels with Americans’ future.

    All in all, Wait Till It’s Free is a powerful tool for convincing friends and family that governmental control of medicine is sheer evil.”

    http://www.lewrockwell.com/lrc-blog/if-you-think-healthcare-is-unaffordable-now/

  18. 2014 August 26 11:50 am
    [18]

    300 Air Jordans get taxed.~~~unless “purchased” via a brick window discount.

  19. 2014 August 26 11:55 am
    [19]
    drdog09 permalink

    17,

    Want to really talk socialized medicine? Have a conversation with any Native American tribal council member. They have been living under `govt managed healthcare` for over a 100 years. All of them will tell you it sux…..

  20. 2014 August 26 11:55 am
    [20]

  21. 2014 August 26 12:07 pm
    [21]

    And the hits just keep coming.

  22. 2014 August 26 1:10 pm
    [23]
    bc3b permalink

    This week’s BJG College Division Football Games. The picks were sent to last year’s participants and suspects.

    Here are week #1 college games. Please bold or somehow highlight the teams you think will win. There are Friday night games so this is due by 7 PM Eastern Time Friday. Send picks to bjgfootball@wowway.net

    BYU @ Connecticut
    Bowling Green @ Western Kentucky
    Colorado State @ Colorado
    UTEP @ New Mexico
    North Dakota State @ Iowa State

    Ohio @ Kent State
    Penn State @ Central Florida
    California @ Northwestern
    West Virginia @ Alabama
    Arkansas @ Auburn

    Troy @ UAB
    Utah State @ Tennessee
    Wisconsin @ LSU
    Clemson @ Georgia
    Florida State @ Oklahoma State
    Miami (FL) @ Louisville

    Lurkers invited!

  23. 2014 August 26 1:10 pm
    [24]

    16 – Said Amb. Stevens around this time 2012.

  24. 2014 August 26 1:18 pm
    [25]

    “Now, Kurdish fighters from the Peshmerga army have confirmed the man’s death.”

    That’s a little good news, even better if they had some advisement on where to find him.

    On the american…
    “Douglas McAuthur McCain, of San Diego, California, was killed over the weekend fighting for the Islamic State of Iraq and al-Sham (ISIS), according to the Free Syrian Army.”

    Headline should read: FSA Reports McCain killed by ISIS. 🙂

  25. 2014 August 26 1:30 pm
    [26]

    http://www.breitbart.com/Breitbart-TV/2014/08/26/Obama-Blames-America-Occupying-Forces-For-Feeding-Extremism

    :facepalm: ; :doublefacepalm: considering the setting.

    “Rather our military action in Iraq has to be part of a broader strategy to protect our people and support our partners to take the fight to ISIS,” he added.”

    … um ok… do you have a specific broader strategy that you’d like to argue\inform the American public of sir, you know, beyond empty theories and platitudes? Cause it sure looks to everyone here and worldwide for that matter that you (let alone any partners) don’t have the slightest clue what the fuck you’re doing.

  26. 2014 August 26 1:58 pm
    [27]

    Like some of said all along, minus the ‘really hard part’.

    http://hotair.com/archives/2014/08/26/irs-now-claims-lois-lerners-emails-not-really-missing-just-really-hard-to-find/

    Oh and ….

    ” On Monday, court filings revealed that the tax agency destroyed Lerner’s blackberry on which the suspect emails were contained after the agency learned that her computer had crashed and a congressional inquiry was already underway. ”


    Ah yes, physically destroying a blackberry because someone’s laptop hard drive ‘crashed’…a year ago and their under investigation… yeah totally sounds like a standard IT processes to me! 🙄 It certainly couldn’t be to further try and cover up law breaking and impede an investigation, that would just be a nutty idea.

  27. 2014 August 26 2:02 pm
    [28]
    drdog09 permalink

    Occupying force? Feeds Extremeism??! Obama you had our asses out of Iraq faster than you can say Jimmy Crack Corn. What an ass. And where are we now? 600 advisors and spec ops guys running around doing bag jobs and bombing ISIS. If I remember right this kinda how Vietnam started. Only this time we are playing both the French and ourselves.

  28. 2014 August 26 2:07 pm
    [29]
    drdog09 permalink

    27,

    I would like to point out that depending on the model NO emails were actually on the Blackberry. Only 5 year or newer models actually had sufficient storage to hold a bunch of mail. Before then they acted merely as mail terminals, all the mail remaining on the server. For security reasons many corps still operate the BB’s that way. If its stolen nothing is lost except contact data.

  29. 2014 August 26 3:25 pm
    [30]
    RepublicanPundit permalink

    X BYU @ Connecticut
    Bowling Green @ X Western Kentucky
    Colorado State @ X Colorado
    X UTEP @ New Mexico
    North Dakota State @ X Iowa State

    X Ohio @ Kent State
    X Penn State @ Central Florida
    X California @ Northwestern
    West Virginia @X Alabama
    Arkansas @X Auburn

    X Troy @ UAB
    Utah State @ X Tennessee
    Wisconsin @X LSU
    Clemson @ X Georgia
    X Florida State @ Oklahoma State
    X Miami (FL) @ Louisville

    X denotes my picks.

    Thanks, B3

  30. 2014 August 26 5:31 pm
    [31]

    crickets chirping ACLU/jesse/naacp/msm/whither art thou? Hypocrisy , thy name is liberalism.

  31. 2014 August 27 2:36 am
    [32]

    29 – That’s sort of the point though, they’re so paranoid about what might have been found they not only wiped it, but physically destroyed it.

    Not even a smidgeon!

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