Walgreens leaving Illinois for Switzerland?

Watchdog.org ^ | July 25, 2014 | SCOTT REEDER

[Coleus]

Walgreens leaving Illinois for Switzerland?

SPRINGFIELD – I picked up my vacation photos at Walgreens the other day.  And I didn’t hear any French, German or Italian spoken.

How surprising.

I’ve read that the Deerfield, Ill.,-based drugstore chain is considering becoming a Swiss corporation. I’ll admit the thought of a company that is essentially an American icon becoming a foreign corporation gives me pause.  After all, Walgreens is one of Illinois’ premier companies. It was founded here in 1901 and is headquartered in Deerfield, Ill. And now they are talking about moving their headquarters to Switzerland.

But what exactly does it mean when a corporation becomes Swiss?  Will they start having complimentary fondue in the checkout lanes?  Will the pharmacist yodel instructions to customers in the drive through?  Or is it a matter of some incorporation paperwork being filed in an office in the Alps rather than Springfield?

I would hate to see Walgreens – or any other corporation – renounce its U.S. citizenship.  Every time that happens, it reminds us that the business climate in this country is not what it should be.  One has to ask, why would a corporation founded in Illinois 113 years ago want to become Swiss? The answer is as obvious as the Matterhorn.

Corporate taxes in Illinois and the United States are too high. Way too high. The United States has the highest corporate tax rates on the planet. And, you guessed it, Illinois has one of the highest state corporate tax rates in the U.S.

Business corporations exist to make money by serving people. And when government makes it harder to earn in one place, they will look elsewhere. We can spend a lot of time bemoaning that fact, or simply acknowledge that is the case and work to create a climate that attracts business and doesn’t repel jobs.   Still the idea of Walgreens leaving is a bitter pill to swallow.

But here is the deal, when a company switches in what country it will be incorporated, as Walgreens is considering, it still pays taxes to the U.S. government on its U.S. earnings. And it would be paying them at the same rate that it always has.  On money it makes overseas it would pay that country’s rate.

Seems fair, right?

Unfortunately, the U.S. expects companies headquartered here to pay the equivalent of the full U.S. rate on money earned elsewhere.   So U.S. companies that do business overseas choose to move their headquarters elsewhere.

So what’s the solution?

The answer would seem to be to lower the corporate income tax rate so that it is competitive with other western nations. In fact, if the U.S. had the same tax policies as Switzerland — or most Western nations — Walgreens would pay billions less in taxes and wouldn’t be considering moving.  The billions saved could go to shareholders in the form of dividends, to employees through higher pay and customers through lower prices.  And what could be more American than that?

 Scott Reeder is a veteran statehouse reporter and a journalist with Illinois News Network, a project of the Illinois Policy Institute. He can be reached at sreeder@illinoispolicy.org. Readers can subscribe to his free political newsletter by going to ILNEWS.ORG or follow his work on Twitter @scottreeder

[Coleus]

Walgreens urged to leave US to gain tax benefit

[Jonty30]

Switzerland is a very pretty country, but to live in what would be the equivalent of a US suburb, it would cost about $4,000/month.

[Still Thinking]

But what exactly does it mean when a corporation becomes Swiss? Will they start having complimentary fondue in the checkout lanes?

No, but you'll be required to be armed at all times on the premises.

[Blood of Tyrants]

The United States has the highest corporate tax rates on the planet. And, you guessed it, Illinois has one of the highest state corporate tax rates in the U.S.

Yet liberals will complain that the only reason corporations leave is because they are too greedy. As if corporations exist to pay the taxes that support the liberal welfare state.

[MtnClimber]

The political left believes that workers are sheep to be sheared, first for their cut and second to buy votes from their permanant underclass supporters. And they get angry when their sheep jump over the fence to get away.

[gaijin]

Doin’ the Tina Turner..!

And I APPROVE!

They’re TEACHING Illinois.

Illinois will pay some tuition and get smarter.

Wellllll…maybe a teeny, tiny bit smarter.

[deadrock]

In before ‘bring jobs back now.’

[dfwgator]

Switzerland is a very pretty country

If you ever go to Lucerne and have a chance to go up Mount Pilatus, I highly recommend it.

[AZLiberty]

Can you say, “fiduciary responsibility”?

Companies are legally required to do what’s best for their shareholders. U.S. tax laws force companies to thumb their nose at America.

[1010RD]

Walgreens is one of Illinois’ premier companies.

Politicians in Illinois took the possessive case too seriously. Walgreens belongs not to Illinois, but to its stock holders.

Capital goes where it's welcome and stays where it's well treated. --Walter B. Wriston

It's that simple.

[jsanders2001]

Coming soon “Barack Obama: how I destroyed an entire using a fake ID and Cloward - Piven”

[usconservative]

Can you say, “fiduciary responsibility”? Companies are legally required to do what’s best for their shareholders. U.S. tax laws force companies to thumb their nose at America.

Game, Set, Match. Winner. Well done.

First rule of business for ANY publicly held company is to maximize value FOR THE SHAREHOLDERS --- not the stupid over-taxing US Federal and Illinois State governments.

Pat Quinn (Gov. IL) is a complete MORON. He's single-handedly chased more jobs out of Illinois than our previous 4 governors COMBINED.

[nathanbedford]

We complain about elites but sometimes it is worthwhile step back and consider how they see the world.

If you are George Soros you do not see the world defined by national boundaries, you see it defined by market areas, transportation grids, and consumer densities. In other words, your American passport is an item of convenience not of conviction. Your preoccupation is worldwide and the nation state is often regarded as an impediment to your ambitions and sometimes regarded as a bulwark against the ambitions of others, or other nation states.

For these people patriotism is a quaint concept.

As a matter of governing intelligently, we must begin to consider how and why we should erect or demolish national barriers to trade and labor. Today, the president of the United States was blathering on about economic patriotism when the concept of sound economics is foreign to him and patriotism is anathema to him. Why, should we believe the Barack Obama can intelligently decide to send $47 billion to Gaza but Walgreen cannot make an rational decision about where it is better advantaged economically?

Obama's role is not to criticize people who are behaving rationally according to their responsibilities to maximize profits, but to make America the most attractive place to maximize profits.

If we let the left define "economic patriotism" we will get neither.

[smokingfrog]

With all the money they’ll be saving, they will be able to pay their employees well, instead of forking it over to be spent by corrupt government agencies.

[bigbob]

Lol!

[bigbob]

I’m not sure the Rats didn’t call their pals at Walgreen and stir up a crisis so the mighty Quinn can now throw some incentives at them and take credit for saving the day.

[MV=PY]

"If you are George Soros you do not see the world defined by national boundaries, you see it defined by market areas, transportation grids, and consumer densities."

Thank you for that perspective. I've never thought about it like that.

[Rodney Dangerfield]

Screw them. I have chronic pain issues and when I bring my prescription for my pain medication in, they treat my like a junkie and 20 minutes means 1 hour.

CVS is nice as can be, offers me a seat and has my meds ready in 15 minutes without practically running a “warrant check” on me. They will even text me when to get in line.

FU Walgreen’s.

[kelly4c]

My insurance company no longer allows me to fill at Walgreens, which I have used for the last 15 years. I really liked my pharmacist he was always nice and willing to take the time and answer questions fully with helpful advice thrown in. Nice Asian guy whom I will miss dealing with.

[stocksthatgoup]

Why not just raise taxes? /s