(WASHINGTON POST) Â When Pfizer announced its plan last year to merge with Botox-makerÂ Allergan and move its headquarters to Ireland the company said the deal would lower its tax rate to aboutÂ 17Â percent to 18 percent, saving it about $2Â billion over three years.
But in a report published Thursday,Â Americans for Tax Fairness say the New York-based pharma giant will actually save much moreÂ by giving up its U.S. citizenship: $35 billion.
Pfizer is merging with the smaller Dublin-based Allergan in what is known as anÂ âinversion,â in whichÂ U.S. companies are bought by or merge with foreign firms in order to reduce U.S. corporate tax burdens. The Pfizer-Allergan deal is the largest inversion everÂ and has raised angst among lawmakers.
In addition to lowering its effective tax rate from about 25 percent,Â Americans for Tax Fairness notesÂ that Pfizer will gain access to $148Â billion in profits it earned overseas and currently canât bring back to the United States without taking a tax hit. Bringing the cash would have cost the firm $35 billion, according to theÂ left-leaning advocacy group.