Durbin Urges Illinois-Based Hospira Not To Turn Its Back On America To Dodge Taxes

Urges Illinois-Based Hospira Not To Turn Its Back On America To Dodge Taxes

Senator warns of another potential corporate inversion at U.S. taxpayer expense

[CHICAGO, IL] – In a letter to the CEO of Lake Forest, Illinois-based Hospira, U.S. Senator Dick Durbin (D-IL) urged the company not to turn its back on American taxpayers and consumers by taking advantage of a tax loophole called “inversion” which allows a company to move its headquarters overseas, but only on paper, in order to avoid paying U.S. taxes.

“Hospira’s success, including second-quarter profits that more than doubled, depends on the educated workforce, transportation infrastructure, and tax benefits here in the United States. Your company’s injectable drugs and infusion technologies are purchased through taxpayer-supported programs, such as the Veterans Health Administration and Medicare, which have contributed to Hospira’s corporate success,” Durbin wrote.

“If your company inverts, the tax dollars you are taking overseas will not be invested in the Veterans Health Administration to provide healthcare benefits to our veterans, basic research to support the development of new drugs, the transportation network that serves your company, or the federal system of patent protections.”

In a July letter to the CEO of Deerfield, Illinois-based Walgreens, Durbin expressed his strong opposition to reports that Walgreens would use a purchase of Swiss-based retailer and wholesaler Alliance Boots in order to “invert.” Last week, Walgreens announced that while it would proceed with the purchase of the remaining stake in Alliance Boots, it will remain headquartered in the United States.

Durbin has been the leading voice in Congress against these inversion schemes, raising the issue in the face of a growing trend toward U.S. corporate tax avoidance. Durbin led a letter – also signed by U.S. Senators Jack Reed (D-RI) and Elizabeth Warren (D-MA) – to President Obama urging him to use his executive authority to reduce or eliminate tax breaks for companies that shift their headquarters overseas to avoid paying U.S. taxes. As Congress considers legislative solutions to the problem, the lawmakers emphasized the need for immediate action, considering the growing trend in corporate tax avoidance.