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This Bud's for Belgium (Corporate Tax Rate Uncompetitive)
Wall Street Journal ^ | August 3, 2008

Posted on 08/03/2008 10:20:18 AM PDT by djsherin

Politicians and Wall Streeters are starting to ask why the Belgian beer company InBev purchased Anheuser-Busch and not the other way around. Anheuser-Busch is an iconic American firm and some find it almost unpatriotic that Anheuser CEO August Busch IV allowed the "King of Beers" to relocate across the Atlantic -- though shareholders were the big winners here with a $50 billion-plus takeaway.

But here's the real question: Was the takeover basically financed by the savings Anheuser expected from escaping America's increasingly uncompetitive corporate tax system? According to the Tax Foundation, Belgium's corporate tax rate is 33%, but the effective tax rate can be half the nominal rate thanks to adjustments for something the OECD calls a "notional allowance for corporate equity." Bottom line: InBev was paying around 20% of its profits in corporate taxes, compared to Anheuser-Busch's rate of 38.4%.

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; Government; News/Current Events
KEYWORDS: anheuserbusch; beer; belgium; budlight; budweiser; fairtax; globalism; govwatch; inbev; taxes
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1 posted on 08/03/2008 10:20:18 AM PDT by djsherin
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To: djsherin

Ah, Budweiser. What gives it that rich, golden color?


2 posted on 08/03/2008 10:22:15 AM PDT by Mr Ramsbotham (Barack Obama--the first black Jimmy Carter.)
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To: Mr Ramsbotham

Yes, indeed once again Americas stupid tax laws drive off another business, even though they will still be here, they are not now American owned, makes a difference, at least to me, and look at the tax revenue the US lost on this deal.


3 posted on 08/03/2008 10:24:48 AM PDT by calex59
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To: djsherin

...and on and on we go - taxing our way to prosperity </s>


4 posted on 08/03/2008 10:25:03 AM PDT by szweig (Had it up to here)
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To: djsherin

On the other hand, we’re spending our way into the ground. Something’s gotta give.


5 posted on 08/03/2008 10:26:40 AM PDT by Wolfie
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To: Toddsterpatriot; Mase; expat_panama

I can’t count the number of times I’ve tried to hammer away at this issue on FR. All I usually get (and especially from the people most worked-up over foreign ownership of anything) is a collective shrug of the shoulders.


6 posted on 08/03/2008 10:27:38 AM PDT by 1rudeboy
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To: 1rudeboy

The income tax system is a mess. Why can’t WE be the ones to lure investment to the US?


7 posted on 08/03/2008 10:33:28 AM PDT by Principled (Vaporize the "Divide and Conquer" taxes - Have everyone pay the same marginal rate!. NRST!)
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To: 1rudeboy

FR has no influence on tax policy, but I agree with your position on it. If it did, you might get more than a shrug.


8 posted on 08/03/2008 10:33:56 AM PDT by muleskinner
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To: djsherin

InBev is publicly traded. Anyone upset about Bud being Belgian owned can buy stock in InBev and become an American owner.

Bud is now Belgian managed, and owned by whoever holds stock in InBev, be they Belgian, Russian, Canadian, Japanese, or American.


9 posted on 08/03/2008 10:34:46 AM PDT by The_Reader_David (And when they behead your own people in the wars which are to come, then you will know. . .)
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To: Mr Ramsbotham
It's foul taste answers that question.
10 posted on 08/03/2008 10:35:23 AM PDT by isrul (Help make every day, "Disrespect a muzzie day.")
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To: djsherin
As predicted by me corp. after corp. will leave if taxed too much. What do you think will happen under an obamby adm. only a few will be left.
11 posted on 08/03/2008 10:37:10 AM PDT by rodguy911 (LAND OF THE FREE BECAUSE OF THE BRAVE)
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To: muleskinner

It’s just frustrating, that’s all . . . our corporate tax policy creates the incentive for American companies to locate overseas, and people twist themselves into pretzels trying to stop American companies from locating overseas. We are treating the symptom and not the disease.


12 posted on 08/03/2008 10:37:29 AM PDT by 1rudeboy
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To: djsherin

A giant vacuum has been left behind.... fill it with another American Beer. The King of Beers can only be American owned....


13 posted on 08/03/2008 10:43:30 AM PDT by Porterville (would you rather live in today's britain or yesterday's CCCP?)
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To: djsherin

And the same thing will happen to Exxon and other oil companies if the dems pull their stupid “windfall profit tax” they are pushing now. Haliburton was the first and it will happen again.


14 posted on 08/03/2008 10:51:17 AM PDT by biff
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To: Mr Ramsbotham

They don’t keep them big horses around for nuttin’.


15 posted on 08/03/2008 11:09:19 AM PDT by PeteB570 (Keeping an eye on the Frying Pan Shoals Buoy)
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To: PeteB570
They don’t keep them big horses around for nuttin’.

Well, if they'd put more hops in the feed, the beer would probably taste better.

16 posted on 08/03/2008 11:14:02 AM PDT by Mr Ramsbotham (Barack Obama--the first black Jimmy Carter.)
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To: djsherin
I'm not sure the Anheuser-Busch acquisition supports the author's point here. A-B's new parent company will still be paying U.S. corporate taxes on their U.S. operations, which is no different than A-B paying U.S. corporate taxes on their own operations.

One consideration here MAY have been that the parent company may no longer have to pay U.S. corporate taxes on the former Anheuser-Busch profits outside the U.S.

17 posted on 08/03/2008 11:23:33 AM PDT by Alberta's Child (I'm out on the outskirts of nowhere . . . with ghosts on my trail, chasing me there.)
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To: 1rudeboy
I can’t count the number of times I’ve tried to hammer away at this issue on FR. All I usually get (and especially from the people most worked-up over foreign ownership of anything) is a collective shrug of the shoulders.

The weak dollar many times will elicit the same response from folks who are unaware that lowering the corporate tax rate and the capital gains tax rate (or at least indexing it to inflation) along with a little deregulation would dramatically increase the FX value of the dollar.

18 posted on 08/03/2008 11:45:02 AM PDT by Mase (Save me from the people who would save me from myself!)
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To: djsherin

Time for the Fair Tax and these mergers will go the other way with America being a top corporate tax haven.


19 posted on 08/03/2008 11:54:28 AM PDT by Libertarianize the GOP (Make all taxes truly voluntary)
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To: djsherin

Augie Quad is a mental lightweight beside whom Al Gore looks like a Rhodes Scholar!

A-B got bought because of widespread stockholder dissatisfaction with poor performance.


20 posted on 08/03/2008 11:55:41 AM PDT by Redbob ("WWJBD" ="What Would Jack Bauer Do?")
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