Tax Break Used by Drug Makers Failed to Add Jobs

[RamboLiberal]

Source: NY Times

Two years ago, when companies received a big tax break to bring home their offshore profits, the president and Congress justified it as a one-time tax amnesty that would create American jobs.

Drug makers were the biggest beneficiaries of the amnesty program, repatriating about $100 billion in foreign profits and paying only minimal taxes. But the companies did not create many jobs in return. Instead, since 2005 the American drug industry has laid off tens of thousands of workers in this country.

And now drug companies are once again using complex strategies, many of them demonstrably legal, to shelter billions of dollars in profits in international tax havens, according to their financial statements and independent tax experts.

In one popular accounting move, companies declare their foreign markets as far more profitable than their American businesses — even though drug prices are typically higher in the United States than anywhere else in the world.

Drug makers are not the only American multinationals using tax loopholes to declare large portions of their income beyond the reach of the Internal Revenue Service. The Brookings Institution estimates that multinational companies are using overseas tax shelters to lower their payments to the Treasury by about $50 billion a year.



Read more: http://www.nytimes.com/2007/07/24/business/24drugtax.html?hp

---

When will the idiots who call in to RW talk radio figure out that high drug prices DO NOT guarantee research and the development of the best drugs and that Americans are the fools getting scammed BIG TIME by Big Pharma and the Repukes who take their lobby money!? And shame on Dem lawmakers who support this crap - hope they get strong primary opposition.

[aquart]

1. They lied. Again. Surprise.

[depakid]

2. No- that's evidence that we need an EVEN BIGGER TAX BREAK

and tons more just like them.

[brentspeak]

3. It was K-Street B.S. from the very beginning.

[Javaman]

6. Exactly, they will argue that the tax breaks weren't big enough to

off set the layoffs.

[Doctor_J]

4. This is why GHWB called it VOODOO ECONOMICS

Throw huge money at big conglomerates and HOPE they are suddenly inspired to have a soul.

:puke:

[gratuitous]

5. What?! Greedy fatcats pocketing their tax breaks?

What's next, the Easter Bunny is a myth?

I sense Bush firing up his veto pen again should Congress dare to monkey with this Treasury giveaway. Bonus points if national security or fighting Al Qaeda can be invoked in the rationale.

[AllegroRondo]

7. I've heard it said many times

No company ever hired someone simply because it had extra money laying around. They hire to meet demand for their products. If there is demand, they will find a way to hire more people.

Give a company extra money, in the form of tax breaks, and all you do is increase profits.

[antigop]

8. If you increase profits, you increase executive bonuses

and the stock prices go up, so their options are worth more.

[PurityOfEssence]

9. Any economic break that's sold for causing investment or creating jobs must be tied to the claim

This bait-and-switch bullshit assumption-mongering needs to stop. If you give a tax break to someone for their capital gains with the selling point that it will stimulate investment, the break should be contingent upon that reinvestment. If a tax break is given to an industry with the rosy prediction that it will create jobs, the break should be tied to delivering said jobs.

Trickle-down is what happens in urinals, and the chirpy justification is nothing more than the damp blue deodorant cookie. A rising tide lifts all yachts, but it drowns the poor suckers who're stuck scraping the barnacles for minimum wage.

This is a three-card monte administration, and its hunger can't be slaked.