Big Pharma pushes back on global tax deal |
Big drug companies and their lobbyists are mobilizing against a sweeping agreement by many of the world’s biggest economies to better harmonize corporate taxation around the globe. Earlier this month, 130 countries agreed to broad outlines of a deal that would, among other steps, establish a minimum corporate tax of 15% within their countries, reducing opportunities for international tax avoidance. Lawyers and company officials estimate the tax overhaul, if adopted, could cost some of the biggest pharmaceutical companies hundreds of millions of dollars more each year. In private industry meetings and discussions with congressional staffers, drug company executives and lobbyists are seeking to use the industry’s pandemic role as leverage, according to people familiar with the effort. “We led the world in responding to this pandemic,” is how one drug-company executive described a key industry message. Pharmaceutical companies are particularly vulnerable to proposed tax changes because they have global operations that sell products around the world. “Pharma has done a lot of tax planning and has put a lot of intangibles into tax havens,” said Richard Collier, who teaches international tax law at the University of Oxford and advised on the global tax framework. The bottom line for the industry, he said, is: “The ground has shifted for the worse.”