Yesterday, Burger King agreed to buy the Canadian restaurant chain Tim Hortons for about $11.4 billion, creating one of the largest fast-food corporations in the world. As part of the deal, Burger King will move its home up north to Canada where corporate taxes are significantly lower than the United States. Under current U.S. law, a company merging with a foreign company can move its headquarters abroad and take advantage of lower taxes, as long as at least twenty percent of its shares are held by the foreign company’s shareholders once the merger is complete. Management and operations of the merging company are still allowed to remain in the U.S. after the merger.

The news has angered some Democrats, who complain that corporate inversions should not be allowed. Rep. Sander Levin (D-MI) has proposed that Congress pass inversion legislation to prevent corporations from moving abroad. He said, “The reported deal with Burger King, an American company, highlights the need for […] → Keep reading