The Senate Finance Committee on Tuesday held a hearing on the topic of “inversion,” a tax avoidance tactic that companies use to legally reincorporate in another country on paper, where a key Senate leader referred to the trend as a virus infecting the U.S. economy. That same day, Dick Durbin, the senior senator from Walgreens’ home state of Illinois wrote a scathing letter to CEO Greg Wasson, warning of a potential consumer and political backlash if Walgreens decides to invert.
On Wednesday, Senate Majority Leader Harry Reid went further, chiding the company for considering a move he described as the definition of “exploitation”.
“The company that Charles Walgreen started is reportedly considering a renunciation of its American citizenship and a move to Switzerland, just to avoid paying its fair share of taxes,” Reid said on the Senate floor. “This practice, what some call ‘inversion,’ is a tax trick — a loophole.”
President Barack Obama joined the chorus of inversion opposition on Thursday, urging quick action by Congress to stop the practice. During his speech at the Los Angeles Technical College, Obama promoted what he called “economic patriotism”.
“I don’t care if it’s legal,” Obama declared. “It’s wrong.”
Walgreens, our country’s biggest pharmacy chain, may move its corporate address overseas to avoid paying its fair share of taxes.
It may soon shift its corporate address from Illinois to Switzerland, a tax haven. This may let the company avoid $4 billion in U.S. taxes over the next five years, leaving the rest of us to pick up the tab.
Walgreens would still be controlled from the U.S. It would still benefit from our roads, bridges and infrastructure, and it would will still have more than $70 billion in annual U.S. sales.
A new report, co-authored by Americans for Tax Fairness and Change to Win Retail Initiatives, explores Walgreens’ potential tax avoidance scheme and the impact it would have.
Read the report here.
An executive of Walgreen Co. abused his position as the Indiana Board of Pharmacy (IBOP) President to help gain approval for a controversial Walgreens pharmacy model called “Well Experience,” an ethics complaint filed today alleges.
Change to Win (CtW) Retail Initiatives and Common Cause Indiana filed the complaint with the Office of the Inspector General. The watchdog groups charge that Ethics Code violations by Walgreens Manager of Pharmacy Affairs Bill Cover and pharmacy board staff corrupted the regulatory process and led to the board approving a pharmacy format that creates risks to public health and patient privacy.
Indiana law prohibits state appointees from participating in decisions in which they or their employer have a financial stake in the outcome. Heavily redacted e-mails obtained through the state’s Access to Public Records Act show that Cover was central to the Board’s Well Experience decision-making process and that he used his position on the board to secure special privileges for Walgreens.
The e-mails illustrate inappropriate involvement in the approval process including: Cover’s collaboration with IBOP staff to provide information from Walgreens to other board members; his deliberation on regulatory issues regarding Well Experience with the board’s executive director; and his solicitation of board members’ concerns before any public discussion about Well Experience.
According to the complaint, Cover and the board improperly kept the approval process from public view. The board held secret meetings with Walgreens management in Illinois deliberately arranged to circumvent Indiana laws requiring open meetings.