U.S. President Barack Obama on Thursday hammered U.S. companies that avoid federal taxes by shifting their tax domiciles overseas in deals known as “inversions” and called on Congress to pass a bill to end the practice.
During remarks to a rowdy crowd at the Los Angeles Technical College, Obama promoted what he called “economic patriotism” and made clear he believed the companies that were engaging in such practices were not being patriotic. The president is in California on a three-day fund-raising swing for Democrats.
So-called inversion deals occur when a U.S. company acquires or sets up a foreign company, then moves its U.S. tax domicile to the foreign company and its lower-tax home country.
Nine inversion deals have been reached this year by companies ranging from banana distributor Chiquita Brands International Inc to drugmaker AbbVie Inc, and more are under consideration. The transactions are setting a record pace since the first inversion was carried out 32 years ago.