Editorial: Suddenly, Canada is a tax haven for firms

The average temperature in Miami is 67 degrees in January. In Ontario, January temperatures range from an average low of 17 to a high of 33.

But Burger King plans to pull up stakes in Miami and move its headquarters to Ontario. That reflects a frigid business climate in the United States.

Burger King will pay nearly $12 billion to acquire Tim Horton’s — a Canadian chain of coffee-and-doughnut shops — and then incorporate in Canada.

Taxes drive this move. The top corporate tax rate in Canada is 15 percent. In the United States, it is 39 percent. Even after adding Ontario’s top rate of 11 percent rate, Canada’s corporate tax rates are two-thirds of those in the United States.

The idea that Canada is a tax haven boggles the mind. That is how out-of-step U.S. taxes are.

“It does get a little annoying when we see other people paying far lower tax rates while engaging in the same sorts of businesses that we engage in,” billionaire Warren Buffett told CNBC.

Buffett is helping to finance the deal.

Taxes alone are not the reason for the deal. Combining Burger King and Tim Horton’s will create the world’s third-largest fast-food company. Some analysts see room to grow Tim Horton’s outside of North America.

But the re-incorporation is an example of supply-side economics. By keeping its corporate tax rates double that of Canada, the U.S. Treasury will see its revenues drop while Canada’s rise in this deal.

If, after this, people still cannot see the ignorance of continuing a usurious tax structure, nothing will.

While Buffett, an early supporter of President Obama, said he does not think corporate taxes are too high, the deal he is helping finance says otherwise.

“This whole thing . . . will cause one hell of a fight in corporate America,” Buffett told CNBC.

This is the conversation Americans should have, instead of questioning the patriotism of corporate executives who are supposed to do the best for their shareholders.

It’s time people in Washington do what is best for the country and lower the corporate tax rates.